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."

Anworth Mortgage Asset Corporation

Dividend Yield: 9.50%

Anworth Mortgage Asset Corporation (NYSE: ANH) shares currently have a dividend yield of 9.50%.

Anworth Mortgage Asset Corporation is a publicly owned real estate investment trust. The firm invests in the fixed income and real estate markets of the United States. The company has a P/E ratio of 9.45. Currently there are 3 analysts that rate Anworth Mortgage Asset Corporation a buy, no analysts rate it a sell, and 1 rates it a hold.

The average volume for Anworth Mortgage Asset Corporation has been 1,251,000 shares per day over the past 30 days. Anworth Mortgage Asset Corporation has a market cap of $909.6 million and is part of the real estate industry. Shares are up 9.5% year to date as of the close of trading on Thursday.

TheStreet Ratings rates Anworth Mortgage Asset Corporation 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 expanding profit margins. However, as a counter to these strengths, we also find weaknesses including feeble growth in the company's earnings per share, deteriorating net income and disappointing return on equity.

Highlights from the ratings report include:
  • Net operating cash flow has significantly increased by 116.21% to $14.32 million when compared to the same quarter last year. In addition, ANWORTH MTG ASSET CORP has also vastly surpassed the industry average cash flow growth rate of 38.95%.
  • The gross profit margin for ANWORTH MTG ASSET CORP is currently very high, coming in at 92.10%. Regardless of ANH's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, ANH's net profit margin of 47.00% significantly outperformed against the industry.
  • 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 greatly underperformed compared to the Real Estate Investment Trusts (REITs) industry average. The net income has decreased by 17.8% when compared to the same quarter one year ago, dropping from $28.39 million to $23.33 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. When compared to other companies in the Real Estate Investment Trusts (REITs) industry and the overall market, ANWORTH MTG ASSET CORP's return on equity is below that of both the industry average and the S&P 500.

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Consolidated Communications

Dividend Yield: 8.80%

Consolidated Communications (NASDAQ: CNSL) shares currently have a dividend yield of 8.80%.

Consolidated Communications Holdings, Inc., together with its subsidiaries, provides telecommunications services to residential and business customers in Illinois, Texas, Pennsylvania, California, Kansas, and Missouri. The company has a P/E ratio of 117.00. Currently there are 3 analysts that rate Consolidated Communications a buy, no analysts rate it a sell, and 1 rates it a hold.

The average volume for Consolidated Communications has been 177,900 shares per day over the past 30 days. Consolidated Communications has a market cap of $699.9 million and is part of the telecommunications industry. Shares are up 10.3% year to date as of the close of trading on Thursday.

TheStreet Ratings rates Consolidated Communications as a hold. The company's strengths can be seen in multiple areas, such as its robust revenue growth, good cash flow from operations and expanding profit margins. However, as a counter to these strengths, we also find weaknesses including a generally disappointing performance in the stock itself, deteriorating net income and generally higher debt management risk.

Highlights from the ratings report include:
  • CNSL's very impressive revenue growth greatly exceeded the industry average of 1.1%. Since the same quarter one year prior, revenues leaped by 70.9%. 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 increased to $51.32 million or 39.15% when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of 13.01%.
  • The gross profit margin for CONSOLIDATED COMM HLDGS INC is rather high; currently it is at 61.40%. Regardless of CNSL's high profit margin, it has managed to decrease from the same period last year.
  • 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. When compared to other companies in the Diversified Telecommunication Services industry and the overall market, CONSOLIDATED COMM HLDGS INC's return on equity is below that of both the industry average and the S&P 500.
  • The share price of CONSOLIDATED COMM HLDGS INC has not done very well: it is down 10.83% 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. 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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Whitestone REIT

Dividend Yield: 7.50%

Whitestone REIT (NYSE: WSR) shares currently have a dividend yield of 7.50%.

No company description available. The company has a P/E ratio of 94.31. Currently there is 1 analyst that rates Whitestone REIT a buy, no analysts rate it a sell, and 3 rate it a hold.

The average volume for Whitestone REIT has been 101,900 shares per day over the past 30 days. Whitestone REIT has a market cap of $257.3 million and is part of the real estate industry. Shares are up 7.8% year to date as of the close of trading on Thursday.

TheStreet Ratings rates Whitestone REIT as a hold. The company's strengths can be seen in multiple areas, such as its robust 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, disappointing return on equity and poor profit margins.

Highlights from the ratings report include:
  • The revenue growth came in higher than the industry average of 16.4%. Since the same quarter one year prior, revenues rose by 34.7%. 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.
  • 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. Looking ahead, the stock's rise over the last year has already helped drive it to a level which is relatively expensive compared to the rest of its industry, implying reduced upside potential.
  • WHITESTONE REIT 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 two years. However, the consensus estimate suggests that this trend should reverse in the coming year. During the past fiscal year, WHITESTONE REIT reported lower earnings of $0.04 versus $0.11 in the prior year. This year, the market expects an improvement in earnings ($0.40 versus $0.04).
  • The gross profit margin for WHITESTONE REIT is rather low; currently it is at 23.80%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of -10.19% is significantly below that of the industry average.
  • Net operating cash flow has decreased to $1.30 million or 39.05% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much 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.

New York Mortgage

Dividend Yield: 14.30%

New York Mortgage (NASDAQ: NYMT) shares currently have a dividend yield of 14.30%.

New York Mortgage Trust, Inc., a real estate investment trust (REIT), engages in acquiring, investing in, financing, and managing mortgage-related and financial assets in the Untied States. The company has a P/E ratio of 6.98. Currently there are 2 analysts that rate New York Mortgage a buy, no analysts rate it a sell, and 1 rates it a hold.

The average volume for New York Mortgage has been 1,194,000 shares per day over the past 30 days. New York Mortgage has a market cap of $374.4 million and is part of the real estate industry. Shares are up 19.3% year to date as of the close of trading on Thursday.

TheStreet Ratings rates New York Mortgage as a hold. The company's strengths can be seen in multiple areas, such as its robust revenue growth, solid stock price performance and attractive valuation levels. However, as a counter to these strengths, we find that the company's profit margins have been poor overall.

Highlights from the ratings report include:
  • NYMT's very impressive revenue growth greatly exceeded the industry average of 16.4%. Since the same quarter one year prior, revenues leaped by 1358.5%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • Compared to where it was a year ago today, the stock is now trading at a higher level, reflecting both the market's overall trend during that period and the fact that the company's earnings growth has been robust. 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.
  • NEW YORK MORTGAGE TRUST INC reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. However, we anticipate underperformance relative to this pattern in the coming year. During the past fiscal year, NEW YORK MORTGAGE TRUST INC increased its bottom line by earning $1.25 versus $0.55 in the prior year. For the next year, the market is expecting a contraction of 23.2% in earnings ($0.96 versus $1.25).
  • 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. When compared to other companies in the Real Estate Investment Trusts (REITs) industry and the overall market, NEW YORK MORTGAGE TRUST INC's return on equity is below that of both the industry average and the S&P 500.
  • The gross profit margin for NEW YORK MORTGAGE TRUST INC is rather low; currently it is at 21.40%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of 18.66% trails that of the industry average.

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.

NTELOS Holdings

Dividend Yield: 13.10%

NTELOS Holdings (NASDAQ: NTLS) shares currently have a dividend yield of 13.10%.

NTELOS Holdings Corp., through its subsidiaries, provides digital wireless communications services to consumers and businesses primarily in Virginia and West Virginia, as well as parts of Maryland, North Carolina, Pennsylvania, Ohio, and Kentucky. The company has a P/E ratio of 14.90. Currently there are 3 analysts that rate NTELOS Holdings a buy, 1 analyst rates it a sell, and 3 rate it a hold.

The average volume for NTELOS Holdings has been 191,900 shares per day over the past 30 days. NTELOS Holdings has a market cap of $272.7 million and is part of the telecommunications industry. Shares are down 2.3% year to date as of the close of trading on Thursday.

TheStreet Ratings rates NTELOS Holdings as a hold. The company's strengths can be seen in multiple areas, such as its revenue growth, compelling growth in net income and good cash flow from operations. However, as a counter to these strengths, we also find weaknesses including poor profit margins, generally higher debt management risk and a generally disappointing performance in the stock itself.

Highlights from the ratings report include:
  • NTLS's revenue growth has slightly outpaced the industry average of 1.5%. Since the same quarter one year prior, revenues rose by 10.8%. 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 net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Wireless Telecommunication Services industry. The net income increased by 100.5% when compared to the same quarter one year prior, rising from -$60.54 million to $0.32 million.
  • The debt-to-equity ratio is very high at 11.10 and currently higher than the industry average, implying increased risk associated with the management of debt levels within the company. Regardless of the company's weak debt-to-equity ratio, NTLS has managed to keep a strong quick ratio of 2.01, which demonstrates the ability to cover short-term cash needs.
  • The gross profit margin for NTELOS HOLDINGS CORP is currently lower than what is desirable, coming in at 26.90%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of 0.27% significantly trails the industry average.

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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