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."

KNOT Offshore Partners

Dividend Yield: 15.50%

KNOT Offshore Partners

(NYSE:

KNOP

) shares currently have a dividend yield of 15.50%.

KNOT Offshore Partners LP owns and operates shuttle tankers under long-term charters in the North Sea and Brazil. The company provides crude oil loading, transportation, and storage services under time charters and bareboat charters. The company has a P/E ratio of 12.66.

The average volume for KNOT Offshore Partners has been 120,000 shares per day over the past 30 days. KNOT Offshore Partners has a market cap of $185.3 million and is part of the transportation industry. Shares are down 39.7% year-to-date as of the close of trading on Thursday.

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TheStreet Ratings rates

KNOT Offshore Partners

as a

sell

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

Highlights from the ratings report include:

  • The debt-to-equity ratio of 1.17 is relatively high when compared with the industry average, suggesting a need for better debt level management.
  • 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. When compared to other companies in the Oil, Gas & Consumable Fuels industry and the overall market, KNOT OFFSHORE PRTNRS LP's return on equity is below that of both the industry average and the S&P 500.
  • Despite any intermediate fluctuations, we have only bad news to report on this stock's performance over the last year: it has tumbled by 41.47%, worse than the S&P 500's performance. Consistent with the plunge in the stock price, the company's earnings per share are down 43.85% 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.
  • 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 29.9% when compared to the same quarter one year ago, falling from $12.56 million to $8.80 million.
  • KNOT OFFSHORE PRTNRS LP's earnings per share declined by 43.9% in the most recent quarter compared to 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, KNOT OFFSHORE PRTNRS LP increased its bottom line by earning $1.34 versus $0.87 in the prior year. This year, the market expects an improvement in earnings ($1.41 versus $1.34).

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Cypress Energy Partners

Dividend Yield: 18.00%

Cypress Energy Partners

(NYSE:

CELP

) shares currently have a dividend yield of 18.00%.

Cypress Energy Partners, L.P. provides saltwater disposal (SWD), and other water and environmental services in North America. It operates in two segments: Water and Environmental Services (W&ES), and Pipeline Inspection and Integrity Services (PI&IS).

The average volume for Cypress Energy Partners has been 29,200 shares per day over the past 30 days. Cypress Energy Partners has a market cap of $53.4 million and is part of the energy industry. Shares are down 36.9% year-to-date as of the close of trading on Thursday.

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TheStreet Ratings rates

Cypress Energy Partners

as a

sell

. The company's weaknesses can be seen in multiple areas, such as its deteriorating net income, disappointing return on equity, poor profit margins, generally high debt management risk 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 significantly underperformed when compared to that of the S&P 500 and the Commercial Services & Supplies industry. The net income has significantly decreased by 150.9% when compared to the same quarter one year ago, falling from $3.56 million to -$1.81 million.
  • 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 Commercial Services & Supplies industry and the overall market, CYPRESS ENERGY PARTNERS LP's return on equity significantly trails that of both the industry average and the S&P 500.
  • The gross profit margin for CYPRESS ENERGY PARTNERS LP is currently extremely low, coming in at 12.55%. Regardless of CELP's low profit margin, it has managed to increase from the same period last year. Despite the mixed results of the gross profit margin, CELP's net profit margin of -1.87% significantly underperformed when compared to the industry average.
  • The debt-to-equity ratio is very high at 4.10 and currently higher than the industry average, implying increased risk associated with the management of debt levels within the company. Despite the company's weak debt-to-equity ratio, the company has managed to keep a very strong quick ratio of 4.04, which shows the ability to cover short-term cash needs.
  • Despite any intermediate fluctuations, we have only bad news to report on this stock's performance over the last year: it has tumbled by 38.05%, worse than the S&P 500's performance. Consistent with the plunge in the stock price, the company's earnings per share are down 150.00% 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.

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Tribune Publishing

Dividend Yield: 7.20%

Tribune Publishing

(NYSE:

TPUB

) shares currently have a dividend yield of 7.20%.

Tribune Publishing Company, a multiplatform media and marketing solutions company, publishes and operates newspapers for audiences and advertisers.

The average volume for Tribune Publishing has been 190,300 shares per day over the past 30 days. Tribune Publishing has a market cap of $254.7 million and is part of the media industry. Shares are down 57.6% year-to-date as of the close of trading on Thursday.

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TheStreet Ratings rates

Tribune Publishing

as a

sell

. The company's weaknesses can be seen in multiple areas, such as its feeble growth in its earnings per share, deteriorating net income, generally high debt management risk, poor profit margins and weak operating cash flow.

Highlights from the ratings report include:

  • TRIBUNE PUBLISHING CO 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. For the next year, the market is expecting a contraction of 41.9% in earnings ($0.96 versus $1.65).
  • 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 Media industry. The net income has significantly decreased by 5413.5% when compared to the same quarter one year ago, falling from -$0.16 million to -$8.60 million.
  • The debt-to-equity ratio is very high at 365.05 and currently higher than the industry average, implying increased risk associated with the management of debt levels within the company. Along with the unfavorable debt-to-equity ratio, TPUB maintains a poor quick ratio of 0.87, which illustrates the inability to avoid short-term cash problems.
  • The gross profit margin for TRIBUNE PUBLISHING CO is currently extremely low, coming in at 1.50%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of -2.12% is significantly below that of the industry average.
  • Net operating cash flow has significantly decreased to $22.60 million or 53.72% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.

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