5 Hold-Rated Dividend Stocks: GHL, MFA, SAN, OFC, UMPQ

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."

Greenhill

Dividend Yield: 4.10%

Greenhill (NYSE: GHL) shares currently have a dividend yield of 4.10%.

Greenhill & Co., Inc., an independent investment bank, provides financial advice on mergers, acquisitions, restructurings, financings, and capital raising to corporations, partnerships, institutions, and governments worldwide. The company has a P/E ratio of 33.58

The average volume for Greenhill has been 339,000 shares per day over the past 30 days Greenhill has a market cap of $1.2 billion and is part of the financial services industry Shares are down 14.3% year to date as of the close of trading on Tuesday

TheStreet Ratings rates Greenhill as a hold. The company's strengths can be seen in multiple areas, such as its good cash flow from operations, solid stock price performance and notable return on equity. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, poor profit margins and feeble growth in the company's earnings per share.

Highlights from the ratings report include:
  • Net operating cash flow has significantly increased by 159.05% to $16.18 million when compared to the same quarter last year. In addition, GREENHILL & CO INC has also vastly surpassed the industry average cash flow growth rate of -303.26%.
  • Compared to its closing price of one year ago, GHL's share price has jumped by 31.00%, exceeding the performance of the broader market during that same time frame. Setting our sights on the months ahead, however, we feel that the stock's sharp appreciation over the last year has driven it to a price level which is now relatively expensive compared to the rest of its industry. The implication is that its reduced upside potential is not good enough to warrant further investment at this time.
  • Regardless of the drop in revenue, the company managed to outperform against the industry average of 6.3%. Since the same quarter one year prior, revenues slightly dropped by 3.7%. The declining revenue appears to have seeped down to the company's bottom line, decreasing earnings per share.
  • 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 Capital Markets industry average. The net income has decreased by 15.6% when compared to the same quarter one year ago, dropping from $16.14 million to $13.62 million.
  • The gross profit margin for GREENHILL & CO INC is currently lower than what is desirable, coming in at 29.80%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of 17.10% trails that of the industry average.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12-months. Learn more.

MFA Financial

Dividend Yield: 10.90%

MFA Financial (NYSE: MFA) shares currently have a dividend yield of 10.90%.

MFA Financial, Inc., a real estate investment trust (REIT), invests in residential agency and non-agency mortgage-backed securities (MBS). The company has a P/E ratio of 9.99

The average volume for MFA Financial has been 3,461,800 shares per day over the past 30 days MFA Financial has a market cap of $2.9 billion and is part of the real estate industry Shares are up 2.6% year to date as of the close of trading on Tuesday

TheStreet Ratings rates MFA Financial as a hold. The company's strengths can be seen in multiple areas, such as its attractive valuation levels, expanding profit margins 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 weak operating cash flow.

Highlights from the ratings report include:
  • The gross profit margin for MFA FINANCIAL INC is currently very high, coming in at 93.20%. Regardless of MFA's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, MFA's net profit margin of 62.19% significantly outperformed against the industry.
  • Compared to where it was 12 months ago, the stock is up, but it has so far lagged the appreciation in the S&P 500. 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 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 on the basis of return on equity, MFA FINANCIAL INC has outperformed in comparison with the industry average, but has underperformed when compared to that of the S&P 500.
  • Net operating cash flow has decreased to $71.17 million or 10.96% when compared to the same quarter last year. Despite a decrease in cash flow of 10.96%, MFA FINANCIAL INC is in line with the industry average cash flow growth rate of -16.12%.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12-months. Learn more.

Banco Santander

Dividend Yield: 9.40%

Banco Santander (NYSE: SAN) shares currently have a dividend yield of 9.40%.

Banco Santander-Chile provides commercial and retail banking services to corporate and individual customers in Chile.

The average volume for Banco Santander has been 7,108,500 shares per day over the past 30 days Banco Santander has a market cap of $69.8 billion and is part of the banking industry Shares are down 20.8% year to date as of the close of trading on Tuesday

TheStreet Ratings rates Banco Santander as a hold. The company's strengths can be seen in multiple areas, such as its revenue growth, expanding profit margins and notable return on equity. However, as a counter to these strengths, we also find weaknesses including a generally disappointing performance in the stock itself, premium valuation and deteriorating net income.

Highlights from the ratings report include:
  • SAN's revenue growth has slightly outpaced the industry average of 1.1%. Since the same quarter one year prior, revenues slightly increased by 4.9%. 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.
  • 46.60% is the gross profit margin for BANCO SANTANDER-CHILE 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, SAN's net profit margin of 16.80% compares favorably to the industry average.
  • 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. In comparison to the other companies in the Commercial Banks industry and the overall market, BANCO SANTANDER-CHILE's return on equity significantly exceeds that of the industry average and is above that of the S&P 500.
  • The share price of BANCO SANTANDER-CHILE has not done very well: it is down 6.64% 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, we do not see anything in this company's numbers that would change the one-year trend. It was down over the last twelve months; and it could be down again in the next twelve. Naturally, a bull or bear market could sway the movement of this stock.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12-months. Learn more.

Corporate Office Properties

Dividend Yield: 4.50%

Corporate Office Properties (NYSE: OFC) shares currently have a dividend yield of 4.50%.

Owns, manages, leases, acquires and develops suburban office properties located in the Greater Washington DC and other markets. At Dec. 31, 2005, this self-managed real estate investment trust owned 165 operating office properties with 13.7 million rentable square feet and several land parcels.

The average volume for Corporate Office Properties has been 580,200 shares per day over the past 30 days Corporate Office Properties has a market cap of $2.1 billion and is part of the real estate industry Shares are down 0.2% year to date as of the close of trading on Tuesday

TheStreet Ratings rates Corporate Office Properties as a hold. The company's strengths can be seen in multiple areas, such as its compelling growth in net income, good cash flow from operations and increase in stock price during the past year. 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:
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Real Estate Investment Trusts (REITs) industry. The net income increased by 45.9% when compared to the same quarter one year prior, rising from $10.30 million to $15.02 million.
  • Net operating cash flow has slightly increased to $47.31 million or 8.04% when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of -16.12%.
  • Compared to where it was 12 months ago, the stock is up, but it has so far lagged the appreciation in the S&P 500. 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 Real Estate Investment Trusts (REITs) industry and the overall market on the basis of return on equity, CORP OFFICE PPTYS TR INC underperformed against that of the industry average and is significantly less than that of the S&P 500.
  • The gross profit margin for CORP OFFICE PPTYS TR INC is currently lower than what is desirable, coming in at 27.80%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of 11.38% significantly trails the industry average.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12-months. Learn more.

Umpqua Holdings Corporation

Dividend Yield: 4.10%

Umpqua Holdings Corporation (NASDAQ: UMPQ) shares currently have a dividend yield of 4.10%.

Umpqua Holdings Corporation operates as the holding company for Umpqua Bank and Umpqua Investments, Inc. that provide commercial, and retail banking and brokerage services to corporate, institutional, and individual customers in the United States. The company has a P/E ratio of 16.77

The average volume for Umpqua Holdings Corporation has been 757,800 shares per day over the past 30 days Umpqua Holdings Corporation has a market cap of $1.7 billion and is part of the banking industry Shares are up 26.9% year to date as of the close of trading on Tuesday

TheStreet Ratings rates Umpqua Holdings Corporation as a hold. The company's strengths can be seen in multiple areas, such as its good cash flow from operations, attractive valuation levels and expanding profit margins. 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:
  • Net operating cash flow has significantly increased by 662.16% to $234.74 million when compared to the same quarter last year. In addition, UMPQUA HOLDINGS CORP has also vastly surpassed the industry average cash flow growth rate of 13.25%.
  • UMPQUA HOLDINGS CORP's earnings per share declined by 8.7% 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, UMPQUA HOLDINGS CORP increased its bottom line by earning $0.91 versus $0.65 in the prior year. This year, the market expects an improvement in earnings ($0.92 versus $0.91).
  • Regardless of the drop in revenue, the company managed to outperform against the industry average of 3.2%. Since the same quarter one year prior, revenues slightly dropped by 3.2%. The declining revenue appears to have seeped down to the company's bottom line, decreasing earnings per share.
  • 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 Commercial Banks industry and the overall market, UMPQUA HOLDINGS CORP's return on equity is below that of both the industry average and the S&P 500.
  • 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 Commercial Banks industry average. The net income has decreased by 8.4% when compared to the same quarter one year ago, dropping from $25.50 million to $23.36 million.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12-months. Learn more.

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