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 "Sell."

Icahn

Dividend Yield: 10.60%

Icahn

(NASDAQ:

IEP

) shares currently have a dividend yield of 10.60%.

Icahn Enterprises L.P., through its subsidiaries, operates in investment, automotive, energy, metals, railcar, gaming, food packaging, real estate, and home fashion businesses in the United States, Germany, and Internationally. Its Investment segment operates various private investment funds.

The average volume for Icahn has been 104,300 shares per day over the past 30 days. Icahn has a market cap of $7.3 billion and is part of the conglomerates industry. Shares are down 4.8% year-to-date as of the close of trading on Thursday.

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TheStreet Ratings rates

Icahn

as a

sell

. The company's weaknesses can be seen in multiple areas, such as its deteriorating net income, generally high debt management risk, disappointing return on equity, poor profit margins and generally disappointing historical performance in the stock itself.

Highlights from the ratings report include:

  • The company, on the basis of change in net income from the same quarter one year ago, has underperformed when compared to that of the S&P 500 and the Industrial Conglomerates industry average. The net income has decreased by 23.7% when compared to the same quarter one year ago, dropping from -$355.00 million to -$439.00 million.
  • The debt-to-equity ratio is very high at 2.60 and currently higher than the industry average, implying increased risk associated with the management of debt levels within the company.
  • Return on equity has greatly decreased when compared to its ROE from the same quarter one year prior. This is a signal of major weakness within the corporation. Compared to other companies in the Industrial Conglomerates industry and the overall market, ICAHN ENTERPRISES LP's return on equity significantly trails that of both the industry average and the S&P 500.
  • The gross profit margin for ICAHN ENTERPRISES LP is currently extremely low, coming in at 0.00%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of -13.82% is significantly below that of the industry average.
  • Looking at the price performance of IEP's shares over the past 12 months, there is not much good news to report: the stock is down 35.46%, and it has underformed the S&P 500 Index. In addition, the company's earnings per share are lower today than the year-earlier quarter. Turning toward the future, the fact that the stock has come down in price over the past year should not necessarily be interpreted as a negative; it could be one of the factors that may help make the stock attractive down the road. Right now, however, we believe that it is too soon to buy.

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VTTI Energy Partners

Dividend Yield: 7.10%

VTTI Energy Partners

(NYSE:

VTTI

) shares currently have a dividend yield of 7.10%.

VTTI Energy Partners LP acquires, develops, owns, and operates refined petroleum product and crude oil terminaling and related energy infrastructure assets.

The average volume for VTTI Energy Partners has been 74,000 shares per day over the past 30 days. VTTI Energy Partners has a market cap of $333.7 million and is part of the energy industry. Shares are down 16.9% year-to-date as of the close of trading on Thursday.

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TheStreet Ratings rates

VTTI Energy Partners

as a

sell

. Among the areas we feel are negative, one of the most important has been a generally disappointing historical performance in the stock itself.

Highlights from the ratings report include:

  • The share price of VTTI ENERGY PARTNRS LP has not done very well: it is down 17.61% and has underperformed the S&P 500, in part reflecting the company's sharply declining earnings per share when compared to the year-earlier quarter. Turning toward the future, the fact that the stock has come down in price over the past year should not necessarily be interpreted as a negative; it could be one of the factors that may help make the stock attractive down the road. Right now, however, we believe that it is too soon to buy.
  • The change in net income from the same quarter one year ago has significantly exceeded that of the Oil, Gas & Consumable Fuels industry average, but is less than that of the S&P 500. The net income has significantly decreased by 52.1% when compared to the same quarter one year ago, falling from $16.90 million to $8.10 million.
  • VTTI ENERGY PARTNRS LP 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 year, the market expects an improvement in earnings ($1.21 versus $0.64).
  • VTTI's debt-to-equity ratio of 1.00 is somewhat low overall, but it is high when compared to the industry average, implying that the management of the debt levels should be evaluated further. Regardless of the somewhat mixed results with the debt-to-equity ratio, the company's quick ratio of 1.24 is sturdy.
  • Despite the weak revenue results, VTTI has significantly outperformed against the industry average of 36.9%. Since the same quarter one year prior, revenues slightly dropped by 1.5%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.

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Acacia Research

Dividend Yield: 14.30%

Acacia Research

(NASDAQ:

ACTG

) shares currently have a dividend yield of 14.30%.

Acacia Research Corporation, through its subsidiaries, invests in, develops, licenses, and enforces patented technologies in the United States.

The average volume for Acacia Research has been 834,100 shares per day over the past 30 days. Acacia Research has a market cap of $177.1 million and is part of the diversified services industry. Shares are down 18.6% year-to-date as of the close of trading on Thursday.

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TheStreet Ratings rates

Acacia Research

as a

sell

. The company's weaknesses can be seen in multiple areas, such as its unimpressive growth in net income, weak operating cash flow, generally disappointing historical performance in the stock itself and feeble growth in its earnings per share.

Highlights from the ratings report include:

  • 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 Professional Services industry. The net income has significantly decreased by 120.0% when compared to the same quarter one year ago, falling from -$12.42 million to -$27.31 million.
  • Net operating cash flow has decreased to $8.60 million or 40.80% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
  • Despite any intermediate fluctuations, we have only bad news to report on this stock's performance over the last year: it has tumbled by 76.99%, worse than the S&P 500's performance. Consistent with the plunge in the stock price, the company's earnings per share are down 111.53% compared to the year-earlier quarter. Naturally, the overall market trend is bound to be a significant factor. However, in one sense, the stock's sharp decline last year is a positive for future investors, making it cheaper (in proportion to its earnings over the past year) than most other stocks in its industry. But due to other concerns, we feel the stock is still not a good buy right now.
  • ACACIA RESEARCH CORP 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. The company has reported a trend of declining earnings per share over the past two years. However, the consensus estimate suggests that this trend should reverse in the coming year. During the past fiscal year, ACACIA RESEARCH CORP reported poor results of -$1.38 versus -$1.18 in the prior year. This year, the market expects an improvement in earnings ($0.18 versus -$1.38).
  • The return on equity has improved slightly when compared to the same quarter one year prior. This can be construed as a modest strength in the organization. Compared to other companies in the Professional Services industry and the overall market, ACACIA RESEARCH CORP's return on equity significantly trails that of both the industry average and the S&P 500.

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