5 Hold-Rated Dividend Stocks

Editor's Note: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model.

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 and 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 5 stocks with substantial yields, that ultimately, we have rated "Hold."

Old Republic International

Dividend Yield: 5.70%

Old Republic International (NYSE: ORI) shares currently have a dividend yield of 5.70%.

Old Republic International Corporation, through its subsidiaries, engages in underwriting insurance products primarily in the United States and Canada. Currently there are 2 analysts that rate Old Republic International a buy, no analysts rate it a sell, and 1 rates it a hold.

The average volume for Old Republic International has been 1,738,200 shares per day over the past 30 days. Old Republic International has a market cap of $3.3 billion and is part of the insurance industry. Shares are up 18.9% year to date as of the close of trading on Tuesday.

TheStreet Ratings rates Old Republic International 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, good cash flow from operations and solid stock price performance. However, as a counter to these strengths, we find that the growth in the company's net income has been quite unimpressive.

Highlights from the ratings report include:
  • ORI's debt-to-equity ratio is very low at 0.16 and is currently below that of the industry average, implying that there has been very successful management of debt levels.
  • Net operating cash flow has significantly increased by 541.28% to $209.70 million when compared to the same quarter last year. In addition, OLD REPUBLIC INTL CORP has also vastly surpassed the industry average cash flow growth rate of 6.58%.
  • Looking at where the stock is today compared to one year ago, we find that it is not only higher, but it has also clearly outperformed the rise in the S&P 500 over the same period, despite the company's weak earnings results. Despite the fact that it has already risen in the past year, there is currently no conclusive evidence that warrants the purchase or sale of this stock.
  • 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 Insurance industry and the overall market on the basis of return on equity, OLD REPUBLIC INTL CORP underperformed against that of the industry average and is significantly less than that of the S&P 500.
  • 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 Insurance industry. The net income has significantly decreased by 136.6% when compared to the same quarter one year ago, falling from $55.20 million to -$20.20 million.

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Brandywine Realty

Dividend Yield: 4.10%

Brandywine Realty (NYSE: BDN) shares currently have a dividend yield of 4.10%.

Brandywine Realty Trust is a publicly owned real estate investment firm. The firm engages in the engaged in the ownership, management, leasing, acquisition, and development of office and industrial properties. It primarily manages Class-A, suburban and urban office portfolio. Currently there are 3 analysts that rate Brandywine Realty a buy, 2 analysts rate it a sell, and 8 rate it a hold.

The average volume for Brandywine Realty has been 2,012,100 shares per day over the past 30 days. Brandywine Realty has a market cap of $2.1 billion and is part of the real estate industry. Shares are up 21.5% year to date as of the close of trading on Tuesday.

TheStreet Ratings rates Brandywine Realty as a hold. The company's strengths can be seen in multiple areas, such as its solid stock price performance, revenue growth and good cash flow from operations. However, as a counter to these strengths, we also find weaknesses including unimpressive growth in net income, disappointing return on equity and poor profit margins.

Highlights from the ratings report include:
  • Compared to its closing price of one year ago, BDN's share price has jumped by 27.65%, exceeding the performance of the broader market during that same time frame. Regarding the stock's future course, our hold rating indicates that we do not recommend additional investment in this stock despite its gains in the past year.
  • BDN's revenue growth trails the industry average of 16.4%. Since the same quarter one year prior, revenues slightly increased by 0.9%. 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.
  • 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 518.1% when compared to the same quarter one year ago, falling from -$4.24 million to -$26.21 million.
  • 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.

New From TheStreet: Jim Cramer's Protégé, Dave Peltier, only buys dividend stocks that have the potential for a 3% to 4% yield and 10% growth. Get his best picks for less than $50/year.

BP

Dividend Yield: 5.10%

BP (NYSE: BP) shares currently have a dividend yield of 5.10%.

BP p.l.c. provides fuel for transportation, energy for heat and light, lubricants to engines, and petrochemicals products. The company has a P/E ratio of 419.60. Currently there are 7 analysts that rate BP a buy, 1 analyst rates it a sell, and 6 rate it a hold.

The average volume for BP has been 7,299,800 shares per day over the past 30 days. BP has a market cap of $133.8 billion and is part of the energy industry. Shares are up 1.6% year to date as of the close of trading on Tuesday.

TheStreet Ratings rates BP as a hold. The company's strengths can be seen in multiple areas, such as its attractive valuation levels, good cash flow from operations and largely solid financial position with reasonable debt levels by most measures. 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:
  • Net operating cash flow has increased to $6,340.00 million or 26.54% when compared to the same quarter last year. Despite an increase in cash flow, BP PLC's average is still marginally south of the industry average growth rate of 29.14%.
  • Regardless of the drop in revenue, the company managed to outperform against the industry average of 2.9%. Since the same quarter one year prior, revenues slightly dropped by 0.6%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
  • 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 Oil, Gas & Consumable Fuels industry. The net income has significantly decreased by 78.9% when compared to the same quarter one year ago, falling from $7,685.00 million to $1,618.00 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. In comparison to the other companies in the Oil, Gas & Consumable Fuels industry and the overall market, BP PLC's return on equity is significantly below that of the industry average and is below that of the S&P 500.

New From TheStreet: Jim Cramer's Protégé, Dave Peltier, only buys dividend stocks that have the potential for a 3% to 4% yield and 10% growth. Get his best picks for less than $50/year.

EV Energy Partner

Dividend Yield: 5.70%

EV Energy Partner (NASDAQ: EVEP) shares currently have a dividend yield of 5.70%.

EV Energy Partners, L.P. engages in the acquisition, development, and production of oil and natural gas properties in the United States. Currently there are 8 analysts that rate EV Energy Partner a buy, no analysts rate it a sell, and 2 rate it a hold.

The average volume for EV Energy Partner has been 322,200 shares per day over the past 30 days. EV Energy Partner has a market cap of $2.3 billion and is part of the energy industry. Shares are down 4.5% year to date as of the close of trading on Tuesday.

TheStreet Ratings rates EV Energy Partner as a hold. The company's strengths can be seen in multiple areas, such as its revenue growth, good cash flow from operations and largely solid financial position with reasonable debt levels by most measures. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, disappointing return on equity and a generally disappointing performance in the stock itself.

Highlights from the ratings report include:
  • The revenue growth came in higher than the industry average of 2.9%. Since the same quarter one year prior, revenues rose by 12.9%. 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.
  • Net operating cash flow has slightly increased to $34.48 million or 3.82% when compared to the same quarter last year. Despite an increase in cash flow, EV ENERGY PARTNERS LP's cash flow growth rate is still lower than the industry average growth rate of 29.14%.
  • 39.90% is the gross profit margin for EV ENERGY PARTNERS LP which we consider to be strong. Despite the high profit margin, it has decreased significantly from the same period last year. Despite the mixed results of the gross profit margin, EVEP's net profit margin of -13.08% significantly underperformed when compared to the industry average.
  • 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 Oil, Gas & Consumable Fuels industry. The net income has significantly decreased by 202.3% when compared to the same quarter one year ago, falling from $9.66 million to -$9.88 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 Oil, Gas & Consumable Fuels industry and the overall market, EV ENERGY PARTNERS LP's return on equity significantly trails that of both the industry average and the S&P 500.

New From TheStreet: Jim Cramer's Protégé, Dave Peltier, only buys dividend stocks that have the potential for a 3% to 4% yield and 10% growth. Get his best picks for less than $50/year.

Crosstex Energy

Dividend Yield: 7.20%

Crosstex Energy (NASDAQ: XTEX) shares currently have a dividend yield of 7.20%.

Crosstex Energy, L.P. operates as an independent midstream energy company. Currently there are 3 analysts that rate Crosstex Energy a buy, no analysts rate it a sell, and 5 rate it a hold.

The average volume for Crosstex Energy has been 785,200 shares per day over the past 30 days. Crosstex Energy has a market cap of $1.4 billion and is part of the energy industry. Shares are up 26.7% year to date as of the close of trading on Tuesday.

TheStreet Ratings rates Crosstex Energy as a hold. The company's strengths can be seen in multiple areas, such as its revenue growth and increase in stock price during the past year. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, generally higher debt management risk and disappointing return on equity.

Highlights from the ratings report include:
  • The revenue growth came in higher than the industry average of 2.9%. Since the same quarter one year prior, revenues slightly increased by 9.4%. 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.
  • Compared to where it was a year ago today, the stock is now trading at a higher level, regardless of the company's weak earnings results. Despite the fact that it has already risen in the past year, there is currently no conclusive evidence that warrants the purchase or sale of this stock.
  • CROSSTEX ENERGY LP has exprienced 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, CROSSTEX ENERGY LP reported poor results of -$1.01 versus -$0.38 in the prior year. This year, the market expects an improvement in earnings (-$0.61 versus -$1.01).
  • The gross profit margin for CROSSTEX ENERGY LP is currently extremely low, coming in at 12.70%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of -4.66% is significantly below that of the industry average.
  • Net operating cash flow has declined marginally to $59.32 million or 0.62% when compared to the same quarter last year. In addition, when comparing the cash generation rate to the industry average, the firm's growth is significantly lower.

New From TheStreet: Jim Cramer's Protégé, Dave Peltier, only buys dividend stocks that have the potential for a 3% to 4% yield and 10% growth. Get his best picks for less than $50/year.

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Editor's Note: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model.

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