Don't Miss Out: Top 4 Yielding Hold-Rated Stocks: DRE, POM, HCN, MEMP

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."

Duke Realty

Dividend Yield: 4.40%

Duke Realty (NYSE: DRE) shares currently have a dividend yield of 4.40%.

Duke Realty Corporation operates as a real estate investment trust (REIT) in the United States. It offers leasing, property and asset management, development, construction, build-to-suit, and other tenant-related services.

The average volume for Duke Realty has been 2,506,000 shares per day over the past 30 days. Duke Realty has a market cap of $5.0 billion and is part of the real estate industry. Shares are up 11.5% year to date as of the close of trading on Thursday.

TheStreet Ratings rates Duke Realty 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 107.5% when compared to the same quarter one year prior, rising from -$17.15 million to $1.29 million.
  • Net operating cash flow has significantly increased by 95.41% to $119.38 million when compared to the same quarter last year. In addition, DUKE REALTY CORP has also vastly surpassed the industry average cash flow growth rate of 1.41%.
  • 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, DUKE REALTY CORP's return on equity significantly trails that of both the industry average and the S&P 500.
  • The gross profit margin for DUKE REALTY CORP is currently extremely low, coming in at 14.47%. Regardless of DRE's low profit margin, it has managed to increase from the same period last year. Despite the mixed results of the gross profit margin, DRE's net profit margin of 0.44% 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.

Pepco Holdings

Dividend Yield: 5.70%

Pepco Holdings (NYSE: POM) shares currently have a dividend yield of 5.70%.

Pepco Holdings, Inc., through its subsidiaries, engages in the transmission, distribution, and supply of electricity. The company also distributes and supplies natural gas. The company has a P/E ratio of 29.38.

The average volume for Pepco Holdings has been 2,013,300 shares per day over the past 30 days. Pepco Holdings has a market cap of $4.8 billion and is part of the utilities industry. Shares are down 2.1% year to date as of the close of trading on Thursday.

TheStreet Ratings rates Pepco Holdings as a hold. The company's strengths can be seen in multiple areas, such as its growth in earnings per share, good cash flow from operations and increase in net income. However, as a counter to these strengths, we also find weaknesses including disappointing return on equity, relatively poor performance when compared with the S&P 500 during the past year and generally higher debt management risk.

Highlights from the ratings report include:
  • PEPCO HOLDINGS INC has improved earnings per share by 15.8% 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, PEPCO HOLDINGS INC reported lower earnings of $0.98 versus $1.14 in the prior year. This year, the market expects an improvement in earnings ($1.12 versus $0.98).
  • Net operating cash flow has slightly increased to $302.00 million or 2.37% 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 2.69%.
  • POM, with its decline in revenue, slightly underperformed the industry average of 1.7%. Since the same quarter one year prior, revenues slightly dropped by 3.2%. The declining revenue has not hurt the company's bottom line, with increasing earnings per share.
  • Even though the current debt-to-equity ratio is 1.21, it is still below the industry average, suggesting that this level of debt is acceptable within the Electric Utilities industry. Even though the debt-to-equity ratio shows mixed results, the company's quick ratio of 0.39 is very low and demonstrates very weak liquidity.
  • 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 Electric Utilities industry and the overall market on the basis of return on equity, PEPCO HOLDINGS INC 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.

Health Care REIT

Dividend Yield: 5.20%

Health Care REIT (NYSE: HCN) shares currently have a dividend yield of 5.20%.

Health Care REIT, Inc. is an independent equity real estate investment trust. The firm engages in acquiring, planning, developing, managing, repositioning and monetizing of real estate assets. It primarily invests in the real estate markets of the United States. The company has a P/E ratio of 80.11.

The average volume for Health Care REIT has been 1,641,400 shares per day over the past 30 days. Health Care REIT has a market cap of $16.9 billion and is part of the real estate industry. Shares are down 4.2% year to date as of the close of trading on Thursday.

TheStreet Ratings rates Health Care REIT as a hold. The company's strengths can be seen in multiple areas, such as its robust revenue growth and good cash flow from operations. 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:
  • HCN's very impressive revenue growth greatly exceeded the industry average of 9.4%. Since the same quarter one year prior, revenues leaped by 70.6%. 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 slightly increased to $219.17 million or 3.17% when compared to the same quarter last year. In addition, HEALTH CARE REIT INC has also modestly surpassed the industry average cash flow growth rate of 1.41%.
  • HEALTH CARE REIT INC's earnings per share declined by 44.4% 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, HEALTH CARE REIT INC increased its bottom line by earning $0.46 versus $0.34 in the prior year. This year, the market expects an improvement in earnings ($0.57 versus $0.46).
  • 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, HEALTH CARE REIT INC underperformed against that of the industry average and is significantly less than that of the S&P 500.
  • The gross profit margin for HEALTH CARE REIT INC is rather low; currently it is at 18.93%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of 4.74% 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.

Memorial Production Partners

Dividend Yield: 11.30%

Memorial Production Partners (NASDAQ: MEMP) shares currently have a dividend yield of 11.30%.

Memorial Production Partners LP, through its subsidiary, Memorial Production Operating LLC, engages in the acquisition, development, exploitation, and production of oil and natural gas properties. The company has a P/E ratio of 114.53.

The average volume for Memorial Production Partners has been 654,600 shares per day over the past 30 days. Memorial Production Partners has a market cap of $1.1 billion and is part of the energy industry. Shares are up 9.1% year to date as of the close of trading on Thursday.

TheStreet Ratings rates Memorial Production Partners as a hold. The company's strengths can be seen in multiple areas, such as its revenue growth, good cash flow from operations and growth in earnings per share. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, generally higher debt management risk and disappointing return on equity.

Highlights from the ratings report include:
  • The revenue growth greatly exceeded the industry average of 5.5%. Since the same quarter one year prior, revenues rose by 38.9%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • Net operating cash flow has significantly increased by 256.66% to $52.36 million when compared to the same quarter last year. In addition, MEMORIAL PRODUCTION PRTRS LP has also vastly surpassed the industry average cash flow growth rate of 0.84%.
  • MEMORIAL PRODUCTION PRTRS LP has improved earnings per share by 14.2% 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, MEMORIAL PRODUCTION PRTRS LP swung to a loss, reporting -$0.01 versus $0.30 in the prior year. This year, the market expects an improvement in earnings ($1.93 versus -$0.01).
  • The debt-to-equity ratio of 1.15 is relatively high when compared with the industry average, suggesting a need for better debt level management.
  • 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. In comparison to the other companies in the Oil, Gas & Consumable Fuels industry and the overall market, MEMORIAL PRODUCTION PRTRS LP's return on equity is significantly below that of the industry average and is below 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.

Other helpful dividend tools from TheStreet:

null

More from Markets

General Electric Booted From Dow, Replaced by Walgreens

General Electric Booted From Dow, Replaced by Walgreens

Dow Plunges on Trade War Worries but Walmart and Verizon Finish Positively

Dow Plunges on Trade War Worries but Walmart and Verizon Finish Positively

Tuesday Turnaround in Politics: Is a Trade War on the Horizon?

Tuesday Turnaround in Politics: Is a Trade War on the Horizon?

FANG Stocks Get Swept Up in Broader Market Selloff

FANG Stocks Get Swept Up in Broader Market Selloff

Snap Shares Plunge After Cowen Cuts Price Target

Snap Shares Plunge After Cowen Cuts Price Target