4 Hold-Rated Dividend Stocks: AEC, ISIL, SFUN, HTA

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

Associated Estates Realty

Dividend Yield: 5.00%

Associated Estates Realty (NYSE: AEC) shares currently have a dividend yield of 5.00%.

Associated Estates Realty Corporation is an independent real estate investment trust. The firm invests in the real estate markets of the United States. It specializes in owning and managing apartment communities in the Midwest, Mid-Atlantic and Southeast regions of the United States. The company has a P/E ratio of 90.29.

The average volume for Associated Estates Realty has been 895,100 shares per day over the past 30 days. Associated Estates Realty has a market cap of $774.5 million and is part of the real estate industry. Shares are down 4.7% year to date as of the close of trading on Tuesday.

TheStreet Ratings rates Associated Estates Realty as a hold. The company's strengths can be seen in multiple areas, such as its revenue growth and notable return on equity. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, poor profit margins and relatively poor performance when compared with the S&P 500 during the past year.

Highlights from the ratings report include:
  • AEC's revenue growth has slightly outpaced the industry average of 7.0%. Since the same quarter one year prior, revenues rose by 14.2%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • ASSOCIATED ESTATES RLTY CORP has shown improvement in its earnings for its most recently reported quarter when compared with the same quarter a year earlier. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. This trend suggests that the performance of the business is improving. During the past fiscal year, ASSOCIATED ESTATES RLTY CORP turned its bottom line around by earning $0.02 versus -$0.27 in the prior year. This year, the market expects an improvement in earnings ($0.38 versus $0.02).
  • The gross profit margin for ASSOCIATED ESTATES RLTY CORP is rather low; currently it is at 19.81%. Regardless of AEC's low profit margin, it has managed to increase from the same period last year. Despite the mixed results of the gross profit margin, AEC's net profit margin of 3.58% is significantly lower than 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 Real Estate Investment Trusts (REITs) industry. The net income has significantly decreased by 93.1% when compared to the same quarter one year ago, falling from $23.67 million to $1.64 million.

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

Intersil Corporation

Dividend Yield: 4.40%

Intersil Corporation (NASDAQ: ISIL) shares currently have a dividend yield of 4.40%.

Intersil Corporation designs, develops, manufactures, and markets analog, mixed-signal, and power management integrated circuits (ICs) for applications in the industrial and infrastructure, personal computing, and consumer electronics markets.

The average volume for Intersil Corporation has been 1,160,400 shares per day over the past 30 days. Intersil Corporation has a market cap of $1.4 billion and is part of the electronics industry. Shares are up 30.4% year to date as of the close of trading on Tuesday.

TheStreet Ratings rates Intersil Corporation as a hold. The company's strengths can be seen in multiple areas, such as its increase in stock price during the past year, increase in net income and largely solid financial position with reasonable debt levels by most measures. However, as a counter to these strengths, we find that the company's return on equity has been disappointing.

Highlights from the ratings report include:
  • 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. Looking ahead, our view is that this company's fundamentals will not have much impact in either direction, allowing the stock to generally move up or down based on the push and pull of the broad market.
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Semiconductors & Semiconductor Equipment industry. The net income increased by 106.9% when compared to the same quarter one year prior, rising from -$14.49 million to $1.00 million.
  • INTERSIL CORP reported significant earnings per share improvement 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, INTERSIL CORP swung to a loss, reporting -$0.29 versus $0.53 in the prior year. This year, the market expects an improvement in earnings ($0.52 versus -$0.29).
  • Regardless of the drop in revenue, the company managed to outperform against the industry average of 11.7%. Since the same quarter one year prior, revenues fell by 11.1%. The declining revenue has not hurt the company's bottom line, with increasing earnings per share.
  • 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 Semiconductors & Semiconductor Equipment industry and the overall market, INTERSIL 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.

SouFun Holdings

Dividend Yield: 5.70%

SouFun Holdings (NYSE: SFUN) shares currently have a dividend yield of 5.70%.

SouFun Holdings Limited operates a real estate Internet portal, and a home furnishing and improvement Website in the People's Republic of China. The company has a P/E ratio of 16.85.

The average volume for SouFun Holdings has been 346,800 shares per day over the past 30 days. SouFun Holdings has a market cap of $2.8 billion and is part of the internet industry. Shares are up 39.4% year to date as of the close of trading on Tuesday.

TheStreet Ratings rates SouFun Holdings as a hold. The company's strengths can be seen in multiple areas, such as its robust revenue growth, solid stock price performance and impressive record of earnings per share growth. However, as a counter to these strengths, we find that the company has favored debt over equity in the management of its balance sheet.

Highlights from the ratings report include:
  • SFUN's very impressive revenue growth greatly exceeded the industry average of 22.6%. Since the same quarter one year prior, revenues leaped by 55.6%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • Powered by its strong earnings growth of 88.88% and other important driving factors, this stock has surged by 197.29% over the past year, outperforming the rise in the S&P 500 Index during the same period. 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.
  • 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 Internet Software & Services industry and the overall market, SOUFUN HLDGS LTD's return on equity significantly exceeds that of both the industry average and the S&P 500.
  • Currently the debt-to-equity ratio of 1.59 is quite high overall and when compared to the industry average, suggesting that the current management of debt levels should be re-evaluated. Along with this, the company manages to maintain a quick ratio of 0.50, which clearly demonstrates the inability to cover short-term cash needs.

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

Healthcare Trust of America

Dividend Yield: 5.50%

Healthcare Trust of America (NYSE: HTA) shares currently have a dividend yield of 5.50%.

No company description available. The company has a P/E ratio of 211.00.

The average volume for Healthcare Trust of America has been 1,515,000 shares per day over the past 30 days. Healthcare Trust of America has a market cap of $1.8 billion and is part of the real estate industry. Shares are up 6.7% year to date as of the close of trading on Tuesday.

TheStreet Ratings rates Healthcare Trust of America as a hold. The company's strengths can be seen in multiple areas, such as its revenue growth, increase in stock price during the past year and increase in net income. 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:
  • HTA's revenue growth has slightly outpaced the industry average of 7.0%. Since the same quarter one year prior, revenues slightly increased by 8.1%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • This stock has managed to rise its share value by 17.58% over the past twelve months. Looking ahead, our view is that this company's fundamentals will not have much impact in either direction, allowing the stock to generally move up or down based on the push and pull of the broad market.
  • HEALTHCARE TRUST OF AMERICA has shown improvement in its earnings for its most recently reported quarter when compared with the same quarter a year earlier. 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, HEALTHCARE TRUST OF AMERICA reported poor results of -$0.10 versus $0.00 in the prior year. This year, the market expects an improvement in earnings ($0.09 versus -$0.10).
  • Compared to other companies in the Real Estate Investment Trusts (REITs) industry and the overall market, HEALTHCARE TRUST OF AMERICA's return on equity significantly trails that of both the industry average and the S&P 500.
  • The gross profit margin for HEALTHCARE TRUST OF AMERICA is rather low; currently it is at 16.04%. Regardless of HTA's low profit margin, it has managed to increase from the same period last year. Despite the mixed results of the gross profit margin, HTA's net profit margin of 1.76% is significantly lower than 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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