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."

National American University Holdings

Dividend Yield: 11.30%

National American University Holdings

(NASDAQ:

NAUH

) shares currently have a dividend yield of 11.30%.

National American University Holdings, Inc. owns and operates National American University (NAU) that provides postsecondary education services primarily for working adults and other non-traditional students in the United States. The company operates through two segments, NAU and Other.

The average volume for National American University Holdings has been 22,300 shares per day over the past 30 days. National American University Holdings has a market cap of $38.4 million and is part of the diversified services industry. Shares are down 27.1% year-to-date as of the close of trading on Monday.

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TheStreet Ratings rates

National American University Holdings

as a

sell

. The company's weaknesses can be seen in multiple areas, such as its deteriorating net income, disappointing return on equity, weak operating cash flow 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 Diversified Consumer Services industry. The net income has significantly decreased by 141.7% when compared to the same quarter one year ago, falling from $2.83 million to -$1.18 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 Diversified Consumer Services industry and the overall market on the basis of return on equity, NATIONAL AMERN UNIV HLDG INC underperformed against that of the industry average and is significantly less than that of the S&P 500.
  • Net operating cash flow has significantly decreased to -$4.26 million or 217.16% 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 53.56%, worse than the S&P 500's performance. Consistent with the plunge in the stock price, the company's earnings per share are down 145.45% 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.
  • NATIONAL AMERN UNIV HLDG INC 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 not demonstrated a clear trend in earnings over the past 2 years, making it difficult to accurately predict earnings for the coming year. During the past fiscal year, NATIONAL AMERN UNIV HLDG INC increased its bottom line by earning $0.27 versus $0.13 in the prior year.

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Apollo Residential Mortgage

Dividend Yield: 14.60%

Apollo Residential Mortgage

(NYSE:

AMTG

) shares currently have a dividend yield of 14.60%.

Apollo Residential Mortgage, Inc. primarily invests in residential mortgage assets in the United States.

The average volume for Apollo Residential Mortgage has been 516,800 shares per day over the past 30 days. Apollo Residential Mortgage has a market cap of $417.7 million and is part of the real estate industry. Shares are up 9.4% year-to-date as of the close of trading on Monday.

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TheStreet Ratings rates

TST Recommends

Apollo Residential Mortgage

as a

sell

. The company's weaknesses can be seen in multiple areas, such as its deteriorating net income, disappointing return on equity, 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 Real Estate Investment Trusts (REITs) industry. The net income has significantly decreased by 109.0% when compared to the same quarter one year ago, falling from $13.29 million to -$1.19 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 Real Estate Investment Trusts (REITs) industry and the overall market, APOLLO RESIDENTIAL MTG INC's return on equity significantly trails that of both the industry average and the S&P 500.
  • The share price of APOLLO RESIDENTIAL MTG INC has not done very well: it is down 17.31% 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. The fact that the stock is now selling for less than others in its industry in relation to its current earnings is not reason enough to justify a buy rating at this time.
  • APOLLO RESIDENTIAL MTG INC 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 year. However, the consensus estimate suggests that this trend should reverse in the coming year. During the past fiscal year, APOLLO RESIDENTIAL MTG INC swung to a loss, reporting -$0.82 versus $2.54 in the prior year. This year, the market expects an improvement in earnings ($1.98 versus -$0.82).
  • AMTG, with its decline in revenue, underperformed when compared the industry average of 8.0%. Since the same quarter one year prior, revenues slightly dropped by 3.3%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.

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Cypress Energy Partners

Dividend Yield: 17.70%

Cypress Energy Partners

(NYSE:

CELP

) shares currently have a dividend yield of 17.70%.

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 38,800 shares per day over the past 30 days. Cypress Energy Partners has a market cap of $108.9 million and is part of the energy industry. Shares are up 12.6% year-to-date as of the close of trading on Monday.

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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 56.30%, 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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