5 Hold-Rated Dividend Stocks: FULL, HRZN, MSB, PGH, CCCL

Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.

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."

Full Circle Capital Corp BDC

Dividend Yield: 11.60%

Full Circle Capital Corp BDC (NASDAQ: FULL) shares currently have a dividend yield of 11.60%.

Full Circle Capital Corporation is a business development company and operates as an externally managed non-diversified closed-end management investment company. The company has a P/E ratio of 46.94.

The average volume for Full Circle Capital Corp BDC has been 63,200 shares per day over the past 30 days. Full Circle Capital Corp BDC has a market cap of $60.4 million and is part of the financial services industry. Shares are up 7.4% year to date as of the close of trading on Monday.

TheStreet Ratings rates Full Circle Capital Corp BDC as a hold. The company's strengths can be seen in multiple areas, such as its revenue growth and expanding profit margins. 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:
  • FULL's revenue growth has slightly outpaced the industry average of 6.0%. Since the same quarter one year prior, revenues slightly increased by 7.8%. 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 gross profit margin for FULL CIRCLE CAPITAL CORP is rather high; currently it is at 61.87%. Regardless of FULL's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, FULL's net profit margin of 49.15% significantly outperformed against the industry.
  • FULL CIRCLE CAPITAL CORP's earnings per share declined by 20.0% in the most recent quarter compared to 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, FULL CIRCLE CAPITAL CORP reported lower earnings of $0.44 versus $0.46 in the prior year. This year, the market expects an improvement in earnings ($0.78 versus $0.44).
  • 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 2.8% when compared to the same quarter one year ago, dropping from $1.52 million to $1.48 million.
  • Current return on equity is lower than its ROE from the same quarter one year prior. This is a clear sign of weakness within the company. Compared to other companies in the Capital Markets industry and the overall market on the basis of return on equity, FULL CIRCLE CAPITAL CORP underperformed against that of the industry average and is significantly less than that of the S&P 500.

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

Horizon Technology Finance Corp BDC

Dividend Yield: 9.60%

Horizon Technology Finance Corp BDC (NASDAQ: HRZN) shares currently have a dividend yield of 9.60%.

Horizon Technology Finance Corporation, a specialty finance company, lends to and invests in development-stage companies in the United States. The company has a P/E ratio of 10.35.

The average volume for Horizon Technology Finance Corp BDC has been 62,200 shares per day over the past 30 days. Horizon Technology Finance Corp BDC has a market cap of $137.7 million and is part of the financial services industry. Shares are down 3.6% year to date as of the close of trading on Monday.

TheStreet Ratings rates Horizon Technology Finance Corp BDC as a hold. The company's strengths can be seen in multiple areas, such as its revenue growth, expanding profit margins and increase in net income. However, as a counter to these strengths, we also find weaknesses including a generally disappointing performance in the stock itself, disappointing return on equity and weak operating cash flow.

Highlights from the ratings report include:
  • HRZN's revenue growth has slightly outpaced the industry average of 6.0%. Since the same quarter one year prior, revenues rose by 11.2%. 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 gross profit margin for HORIZON TECHNOLOGY FINANCE is rather high; currently it is at 61.70%. It has increased from the same quarter the previous year. Along with this, the net profit margin of 40.48% significantly outperformed against 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. Compared to other companies in the Capital Markets industry and the overall market on the basis of return on equity, HORIZON TECHNOLOGY FINANCE 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 -$18.39 million or 681.35% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.

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

Mesabi

Dividend Yield: 10.20%

Mesabi (NYSE: MSB) shares currently have a dividend yield of 10.20%.

Mesabi Trust operates as a royalty trust in the United States. The company produces iron ore pellets. It holds interest in the Peter Mitchell mine located in the Mesabi Iron Range near Babbitt, Minnesota. The company has a P/E ratio of 8.05.

The average volume for Mesabi has been 59,000 shares per day over the past 30 days. Mesabi has a market cap of $237.6 million and is part of the financial services industry. Shares are down 28.4% year to date as of the close of trading on Monday.

TheStreet Ratings rates Mesabi 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, notable return on equity and good cash flow from operations. However, as a counter to these strengths, we also find weaknesses including feeble growth in the company's earnings per share and a generally disappointing performance in the stock itself.

Highlights from the ratings report include:
  • MSB has no debt to speak of therefore resulting in a debt-to-equity ratio of zero, which we consider to be a relatively favorable sign. Along with this, the company maintains a quick ratio of 2.77, which clearly demonstrates the ability to cover short-term cash needs.
  • The company's current return on equity greatly increased when compared to its ROE from the same quarter one year prior. This is a signal of significant strength within the corporation. Compared to other companies in the Metals & Mining industry and the overall market, MESABI TRUST's return on equity significantly exceeds that of both the industry average and the S&P 500.
  • The gross profit margin for MESABI TRUST is currently very high, coming in at 100.00%. MSB has managed to maintain the strong profit margin since the same quarter of last year. Despite the mixed results of the gross profit margin, MSB's net profit margin of 87.06% significantly outperformed against the industry.
  • Despite any intermediate fluctuations, we have only bad news to report on this stock's performance over the last year: it has tumbled by 31.90%, worse than the S&P 500's performance. Consistent with the plunge in the stock price, the company's earnings per share are down 34.61% 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.
  • MESABI TRUST's earnings per share declined by 34.6% in the most recent quarter compared to the same quarter a year ago. The company has reported a trend of declining earnings per share over the past two years. During the past fiscal year, MESABI TRUST reported lower earnings of $2.35 versus $2.53 in the prior year.

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

Pengrowth Energy

Dividend Yield: 7.90%

Pengrowth Energy (NYSE: PGH) shares currently have a dividend yield of 7.90%.

Pengrowth Energy Corporation engages in the acquisition, exploration, development, and production of oil and natural gas reserves in Canada.

The average volume for Pengrowth Energy has been 1,630,600 shares per day over the past 30 days. Pengrowth Energy has a market cap of $3.0 billion and is part of the energy industry. Shares are up 20.3% year to date as of the close of trading on Monday.

TheStreet Ratings rates Pengrowth Energy as a hold. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures and good cash flow from operations. 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:
  • The revenue growth came in higher than the industry average of 10.7%. 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 current debt-to-equity ratio, 0.40, is low and is below the industry average, implying that there has been successful management of debt levels.
  • The gross profit margin for PENGROWTH ENERGY CORP is rather high; currently it is at 52.75%. Regardless of PGH's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, PGH's net profit margin of -24.82% 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 9135.0% when compared to the same quarter one year ago, falling from $0.72 million to -$65.05 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 Oil, Gas & Consumable Fuels industry and the overall market, PENGROWTH ENERGY CORP's return on equity significantly trails that of both the industry average and the S&P 500.

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

China Ceramics

Dividend Yield: 9.70%

China Ceramics (NASDAQ: CCCL) shares currently have a dividend yield of 9.70%.

China Ceramics Co., Ltd. engages in the manufacture and sale of ceramic tiles for exterior siding and interior flooring, and design in residential and commercial buildings in the People's Republic of China and internationally. The company has a P/E ratio of 1.57.

The average volume for China Ceramics has been 51,000 shares per day over the past 30 days. China Ceramics has a market cap of $42.1 million and is part of the materials & construction industry. Shares are down 4.2% year to date as of the close of trading on Monday.

TheStreet Ratings rates China Ceramics 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, reasonable valuation levels and good cash flow from operations. 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 poor profit margins.

Highlights from the ratings report include:
  • CCCL's debt-to-equity ratio is very low at 0.04 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Along with this, the company maintains a quick ratio of 3.37, which clearly demonstrates the ability to cover short-term cash needs.
  • CCCL, with its very weak revenue results, has greatly underperformed against the industry average of 3.9%. Since the same quarter one year prior, revenues plummeted by 59.4%. 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 Building Products industry. The net income has significantly decreased by 107.6% when compared to the same quarter one year ago, falling from $11.38 million to -$0.87 million.
  • The gross profit margin for CHINA CERAMICS CO LTD is currently extremely low, coming in at 14.83%. It has decreased significantly from the same period last year. Along with this, the net profit margin of -3.60% 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.

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