TheStreet Ratings' stock model projects a stock's total return potential over a 12-month period including both price appreciation and dividends. Our Buy, Hold or Sell ratings designate how we expect these stocks to perform against a general benchmark of the equities market and interest rates.

While plenty of high-yield opportunities exist, investors must always consider the safety of their dividend and the total return potential of their investment. It is not uncommon for a struggling company to suspend high-yielding dividends which could subsequently result in precipitous share price declines.

TheStreet Ratings' stock rating model views dividends favorably, but not so much that other factors are disregarded. Our model gauges the relationship between risk and reward in several ways, including: the pricing drawdown as compared to potential profit volatility, i.e. how much one is willing to risk in order to earn profits?; the level of acceptable volatility for highly performing stocks; the current valuation as compared to projected earnings growth; and the financial strength of the underlying company as compared to its stock's valuation as compared to its stock's performance.

These and many more derived observations are then combined, ranked, weighted, and scenario-tested to create a more complete analysis. The result is a systematic and disciplined method of selecting stocks. As always, stock ratings should not be treated as gospel — rather, use them as a starting point for your own research.

The following pages contain our analysis of 3 stocks with substantial yields, that ultimately, we have rated "Hold."

Washington REIT

Dividend Yield: 4.80%

Washington REIT

(NYSE:

WRE

) shares currently have a dividend yield of 4.80%.

Washington Real Estate Investment Trust is an equity real estate investment trust (REIT). The company engages in the ownership, operation, and development of real properties. The firm invests in real estate markets of the greater Washington D.C. metro region. The company has a P/E ratio of 52.00.

The average volume for Washington REIT has been 472,600 shares per day over the past 30 days. Washington REIT has a market cap of $1.7 billion and is part of the real estate industry. Shares are down 9% year-to-date as of the close of trading on Wednesday.

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TheStreet Ratings rates

Washington REIT

as a

hold

. The company's strengths can be seen in multiple areas, such as its revenue growth, good cash flow from operations and notable return on equity. However, as a counter to these strengths, we also find weaknesses including a generally disappointing performance in the stock itself, deteriorating net income and poor profit margins.

Highlights from the ratings report include:

  • Despite its growing revenue, the company underperformed as compared with the industry average of 9.7%. Since the same quarter one year prior, revenues slightly increased by 2.7%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
  • WASHINGTON REIT has experienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, WASHINGTON REIT increased its bottom line by earning $0.06 versus $0.00 in the prior year. This year, the market expects an improvement in earnings ($0.50 versus $0.06).
  • The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Real Estate Investment Trusts (REITs) industry. The net income has significantly decreased by 334.2% when compared to the same quarter one year ago, falling from $1.09 million to -$2.55 million.
  • The share price of WASHINGTON REIT is down 5.29% when compared to where it was trading one year earlier. This reflects both (a) the trend in the overall market as well as (b) the sharp decline in the company's earnings per share. Looking ahead, other than the push or pull of the broad market, we do not see anything in the company's numbers that may help reverse the decline experienced over the past 12 months. Despite the past decline, the stock is still selling for more than most others in its industry.

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National Oilwell Varco

Dividend Yield: 4.90%

National Oilwell Varco

(NYSE:

NOV

) shares currently have a dividend yield of 4.90%.

National Oilwell Varco, Inc. designs, manufactures, and sells equipment and components used in oil and gas drilling, completion, and production; and provides oilfield services to the upstream oil and gas industry worldwide. The company has a P/E ratio of 8.29.

The average volume for National Oilwell Varco has been 6,223,900 shares per day over the past 30 days. National Oilwell Varco has a market cap of $14.4 billion and is part of the energy industry. Shares are down 43.4% year-to-date as of the close of trading on Wednesday.

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TheStreet Ratings rates

National Oilwell Varco

as a

hold

. The company's strengths can be seen in multiple areas, such as its largely solid financial position with reasonable debt levels by most measures and reasonable valuation levels. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, disappointing return on equity and poor profit margins.

Highlights from the ratings report include:

  • NOV's debt-to-equity ratio is very low at 0.23 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Along with the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.06, which illustrates the ability to avoid short-term cash problems.
  • NOV, with its decline in revenue, slightly underperformed the industry average of 22.3%. Since the same quarter one year prior, revenues fell by 25.6%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
  • Net operating cash flow has significantly decreased to $194.00 million or 77.72% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
  • The company's current return on equity has slightly decreased from the same quarter one year prior. This implies a minor weakness in the organization. In comparison to the other companies in the Energy Equipment & Services industry and the overall market, NATIONAL OILWELL VARCO INC's return on equity is significantly below that of the industry average and is below that of the S&P 500.

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Brandywine Realty

Dividend Yield: 4.90%

Brandywine Realty

(NYSE:

BDN

) shares currently have a dividend yield of 4.90%.

Brandywine Realty Trust is a publically owned real estate investment trust. The firm invests in real estate markets of the United States. It makes investments in office, mixed-use, and industrial properties. The company has a P/E ratio of 204.33.

The average volume for Brandywine Realty has been 2,112,900 shares per day over the past 30 days. Brandywine Realty has a market cap of $2.2 billion and is part of the real estate industry. Shares are down 22.9% year-to-date as of the close of trading on Wednesday.

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TheStreet Ratings rates

Brandywine Realty

as a

hold

. The company's strengths can be seen in multiple areas, such as its increase in net income and good cash flow from operations. However, as a counter to these strengths, we also find weaknesses including disappointing return on equity, poor profit margins and a generally disappointing performance in the stock itself.

Highlights from the ratings report include:

  • The net income growth from the same quarter one year ago has greatly exceeded that of the S&P 500, but is less than that of the Real Estate Investment Trusts (REITs) industry average. The net income increased by 39.4% when compared to the same quarter one year prior, rising from $2.19 million to $3.06 million.
  • BRANDYWINE REALTY TRUST has shown improvement in its earnings for its most recently reported quarter when compared with the same quarter a year earlier. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, BRANDYWINE REALTY TRUST swung to a loss, reporting -$0.01 versus $0.20 in the prior year. This year, the market expects an improvement in earnings ($0.18 versus -$0.01).
  • The company's current return on equity has slightly decreased from the same quarter one year prior. This implies a minor weakness in the organization. Compared to other companies in the Real Estate Investment Trusts (REITs) industry and the overall market, BRANDYWINE REALTY TRUST's return on equity significantly trails that of both the industry average and the S&P 500.
  • The gross profit margin for BRANDYWINE REALTY TRUST is rather low; currently it is at 20.84%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of 2.10% significantly trails the industry average.

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