Top 5 Yielding Hold-Rated Stocks: EDR, POM, NRF, CBL, APU

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."

Education Realty

Dividend Yield: 4.80%

Education Realty (NYSE: EDR) shares currently have a dividend yield of 4.80%.

Education Realty Trust, Inc., a real estate investment trust (REIT), develops, acquires, owns, and manages student housing communities located near university campuses in the United States. The company has a P/E ratio of 306.33.

The average volume for Education Realty has been 1,497,400 shares per day over the past 30 days. Education Realty has a market cap of $1.1 billion and is part of the real estate industry. Shares are down 13.6% year to date as of the close of trading on Tuesday.

TheStreet Ratings rates Education Realty as a hold. The company's strengths can be seen in multiple areas, such as its robust 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 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 10.8%. Since the same quarter one year prior, revenues rose by 30.3%. This growth in revenue does not appear to have trickled down to the company's bottom line, displaying stagnant 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 Real Estate Investment Trusts (REITs) industry. The net income increased by 205.1% when compared to the same quarter one year prior, rising from $1.26 million to $3.83 million.
  • Net operating cash flow has slightly increased to $17.56 million or 2.68% when compared to the same quarter last year. Despite an increase in cash flow, EDUCATION REALTY TRUST INC's average is still marginally south of the industry average growth rate of 5.47%.
  • This stock's share value has moved by only 15.49% over the past year. 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.
  • The gross profit margin for EDUCATION REALTY TRUST INC is currently extremely low, coming in at 9.55%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of 9.10% 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.

Pepco Holdings

Dividend Yield: 5.80%

Pepco Holdings (NYSE: POM) shares currently have a dividend yield of 5.80%.

Pepco Holdings, Inc., through its subsidiaries, engages in the transmission, distribution, and supply of electricity. The company also distributes and supplies natural gas.

The average volume for Pepco Holdings has been 2,387,000 shares per day over the past 30 days. Pepco Holdings has a market cap of $4.7 billion and is part of the utilities industry. Shares are down 4.8% year to date as of the close of trading on Tuesday.

TheStreet Ratings rates Pepco Holdings as a hold. The company's strengths can be seen in multiple areas, such as its good cash flow from operations 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 generally higher debt management risk.

Highlights from the ratings report include:
  • Net operating cash flow has slightly increased to $111.00 million or 9.90% when compared to the same quarter last year. Despite an increase in cash flow, PEPCO HOLDINGS INC's average is still marginally south of the industry average growth rate of 18.99%.
  • POM, with its decline in revenue, underperformed when compared the industry average of 16.5%. Since the same quarter one year prior, revenues slightly dropped by 1.6%. The declining revenue appears to have seeped down to the company's bottom line, decreasing earnings per share.
  • In its most recent trading session, POM has closed at a price level that was not very different from its closing price of one year earlier. This is probably due to its weak earnings growth as well as other mixed factors. 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.
  • 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 Electric Utilities industry and the overall market, PEPCO HOLDINGS INC's return on equity significantly trails 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 significantly underperformed against the S&P 500 and did not exceed that of the Electric Utilities industry. The net income has significantly decreased by 32.3% when compared to the same quarter one year ago, falling from $62.00 million to $42.00 million.

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

Northstar Realty Finance Corporation

Dividend Yield: 8.60%

Northstar Realty Finance Corporation (NYSE: NRF) shares currently have a dividend yield of 8.60%.

NorthStar Realty Finance Corp., a real estate investment trust (REIT), operates as a commercial real estate (CRE) investment and asset management company in the United States.

The average volume for Northstar Realty Finance Corporation has been 3,544,400 shares per day over the past 30 days. Northstar Realty Finance Corporation has a market cap of $2.2 billion and is part of the real estate industry. Shares are up 31.7% year to date as of the close of trading on Tuesday.

TheStreet Ratings rates Northstar Realty Finance Corporation 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's return on equity has been disappointing.

Highlights from the ratings report include:
  • NRF's very impressive revenue growth greatly exceeded the industry average of 10.8%. Since the same quarter one year prior, revenues leaped by 59.6%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • Powered by its strong earnings growth of 90.32% and other important driving factors, this stock has surged by 49.84% 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.
  • 47.45% is the gross profit margin for NORTHSTAR REALTY FINANCE CP which we consider to be strong. Regardless of NRF's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, NRF's net profit margin of 0.19% is significantly lower than the industry average.
  • 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 Real Estate Investment Trusts (REITs) industry and the overall market, NORTHSTAR REALTY FINANCE CP'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.

CBL & Associates Properties

Dividend Yield: 4.70%

CBL & Associates Properties (NYSE: CBL) shares currently have a dividend yield of 4.70%.

CBL & Associates Properties, Inc. is a public real estate investment trust. It engages in acquisition, development, and management of properties. The fund invests in the real estate markets of United States. Its portfolio consists of enclosed malls and open-air centers. The company has a P/E ratio of 42.63.

The average volume for CBL & Associates Properties has been 1,685,900 shares per day over the past 30 days. CBL & Associates Properties has a market cap of $3.3 billion and is part of the real estate industry. Shares are down 7.5% year to date as of the close of trading on Tuesday.

TheStreet Ratings rates CBL & Associates Properties as a hold. The company's strengths can be seen in multiple areas, such as its revenue growth, reasonable valuation levels and notable return on equity. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, poor profit margins and weak operating cash flow.

Highlights from the ratings report include:
  • Despite its growing revenue, the company underperformed as compared with the industry average of 10.8%. Since the same quarter one year prior, revenues slightly increased by 4.2%. 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.
  • CBL & ASSOCIATES PPTYS INC 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. 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, CBL & ASSOCIATES PPTYS INC increased its bottom line by earning $0.63 versus $0.49 in the prior year. This year, the market expects an improvement in earnings ($0.65 versus $0.63).
  • Net operating cash flow has declined marginally to $122.16 million or 4.53% when compared to the same quarter last year. In conjunction, when comparing current results to the industry average, CBL & ASSOCIATES PPTYS INC has marginally lower results.
  • 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 60.1% when compared to the same quarter one year ago, falling from $29.39 million to $11.72 million.

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

AmeriGas Partners

Dividend Yield: 7.70%

AmeriGas Partners (NYSE: APU) shares currently have a dividend yield of 7.70%.

AmeriGas Partners, L.P. operates as a retail and wholesale distributor of propane gas, and related equipment and supplies in the United States. The company has a P/E ratio of 25.83.

The average volume for AmeriGas Partners has been 315,900 shares per day over the past 30 days. AmeriGas Partners has a market cap of $4.0 billion and is part of the utilities industry. Shares are up 12% year to date as of the close of trading on Tuesday.

TheStreet Ratings rates AmeriGas Partners as a hold. The company's strengths can be seen in multiple areas, such as its compelling growth in net income, revenue growth and notable return on equity. However, as a counter to these strengths, we also find weaknesses including generally higher debt management risk and weak operating cash flow.

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 Gas Utilities industry. The net income increased by 61.3% when compared to the same quarter one year prior, rising from -$89.38 million to -$34.60 million.
  • APU's revenue growth trails the industry average of 21.1%. Since the same quarter one year prior, revenues slightly increased by 1.7%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • In its most recent trading session, APU has closed at a price level that was not very different from its closing price of one year earlier. This is probably due to its weak earnings growth as well as other mixed factors.
  • Currently the debt-to-equity ratio of 1.60 is quite high overall and when compared to the industry average, suggesting that the current management of debt levels should be re-evaluated. To add to this, APU has a quick ratio of 0.66, this demonstrates the lack of ability of the company to cover short-term liquidity needs.
  • Net operating cash flow has decreased to $57.23 million or 43.00% 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.

Other helpful dividend tools from TheStreet:

null

More from Markets

Dow Futures Plunge, Global Markets Rocked as Trump Takes Trade War to Next Level

Dow Futures Plunge, Global Markets Rocked as Trump Takes Trade War to Next Level

Asia Markets Fall on Latest Tariff Threats From Trump

Asia Markets Fall on Latest Tariff Threats From Trump

Google Invests in JD.com; Comcast-Disney Battle Nears Head -- ICYMI

Google Invests in JD.com; Comcast-Disney Battle Nears Head -- ICYMI

REPLAY: Jim Cramer on Tariff Worries, Oil, Alphabet and Centene

REPLAY: Jim Cramer on Tariff Worries, Oil, Alphabet and Centene

Video: Athens Stock Exchange CEO on What's Next for Greece's Debt Woes

Video: Athens Stock Exchange CEO on What's Next for Greece's Debt Woes