What To Hold: 3 Hold-Rated Dividend Stocks PBF, HCLP, 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 which could 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 3 stocks with substantial yields, that ultimately, we have rated "Hold."

PBF Energy

Dividend Yield: 4.10%

PBF Energy (NYSE: PBF) shares currently have a dividend yield of 4.10%.

PBF Energy Inc., together with its subsidiaries, is engaged in the refining and supply of petroleum products. The company has a P/E ratio of 22.65.

The average volume for PBF Energy has been 1,312,800 shares per day over the past 30 days. PBF Energy has a market cap of $2.0 billion and is part of the energy industry. Shares are down 6.2% year-to-date as of the close of trading on Wednesday.

TheStreet Ratings rates PBF Energy as a hold. Among the primary strengths of the company is its attractive valuation levels, considering its current price compared to earnings, book value and other measures. At the same time, however, we also find weaknesses including deteriorating net income, generally higher debt management risk and disappointing return on equity.

Highlights from the ratings report include:
  • Regardless of the drop in revenue, the company managed to outperform against the industry average of 7.6%. Since the same quarter one year prior, revenues slightly dropped by 2.7%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
  • PBF ENERGY INC has experienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from the same quarter a year ago. The company has reported a trend of declining earnings per share over the past two years. However, the consensus estimate suggests that this trend should reverse in the coming year. During the past fiscal year, PBF ENERGY INC reported lower earnings of $1.35 versus $37.61 in the prior year. This year, the market expects an improvement in earnings ($2.86 versus $1.35).
  • Net operating cash flow has significantly decreased to $148.75 million or 56.71% when compared to the same quarter last year. In addition, when comparing the cash generation rate to the industry average, the firm's growth is significantly lower.
  • The share price of PBF ENERGY INC has not done very well: it is down 10.22% 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, 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.

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

Hi-Crush Partners

Dividend Yield: 5.20%

Hi-Crush Partners (NYSE: HCLP) shares currently have a dividend yield of 5.20%.

Hi-Crush Partners LP operates as a producer and supplier of monocrystalline sand. Monocrystalline sand is a mineral that is used as a proppant to enhance the recovery rates of hydrocarbons from oil and natural gas wells. The company has a P/E ratio of 19.76.

The average volume for Hi-Crush Partners has been 239,700 shares per day over the past 30 days. Hi-Crush Partners has a market cap of $617.7 million and is part of the metals & mining industry. Shares are up 6.6% year-to-date as of the close of trading on Wednesday.

TheStreet Ratings rates Hi-Crush Partners as a hold. The company's strengths can be seen in multiple areas, such as its notable return on equity, robust revenue growth and solid stock price performance. However, as a counter to these strengths, we find that we feel that the company's cash flow from its operations has been weak overall.

Highlights from the ratings report include:
  • Compared to other companies in the Metals & Mining industry and the overall market, HI-CRUSH PARTNERS LP's return on equity significantly exceeds that of both the industry average and the S&P 500.
  • HCLP's very impressive revenue growth greatly exceeded the industry average of 7.6%. Since the same quarter one year prior, revenues leaped by 217.6%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • HCLP's debt-to-equity ratio of 0.94 is somewhat low overall, but it is high when compared to the industry average, implying that the management of the debt levels should be evaluated further. Even though the debt-to-equity ratio shows mixed results, the company's quick ratio of 3.17 is very high and demonstrates very strong liquidity.
  • The company, on the basis of net income growth from the same quarter one year ago, has significantly underperformed compared to the Metals & Mining industry average, but is greater than that of the S&P 500. The net income increased by 92.1% when compared to the same quarter one year prior, rising from $9.40 million to $18.06 million.
  • Net operating cash flow has declined marginally to $11.28 million or 3.55% when compared to the same quarter last year. Despite a decrease in cash flow HI-CRUSH PARTNERS LP is still fairing well by exceeding its industry average cash flow growth rate of -39.42%.

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: 5.00%

Healthcare Trust of America (NYSE: HTA) shares currently have a dividend yield of 5.00%.

Healthcare Trust of America is a fully integrated, self-administered and internally managed real estate investment trust, or REIT. The company acquires, owns and operates medical office buildings and other facilities that serve the healthcare industry. The company has a P/E ratio of 114.10.

The average volume for Healthcare Trust of America has been 1,789,700 shares per day over the past 30 days. Healthcare Trust of America has a market cap of $2.7 billion and is part of the real estate industry. Shares are up 18% year-to-date as of the close of trading on Wednesday.

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, impressive record of earnings per share growth and compelling growth in net income. However, as a counter to these strengths, we also find weaknesses including weak operating cash flow, poor profit margins and a generally disappointing performance in the stock itself.

Highlights from the ratings report include:
  • HTA's revenue growth has slightly outpaced the industry average of 6.7%. Since the same quarter one year prior, revenues rose by 13.9%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • HEALTHCARE TRUST OF AMERICA reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. 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, HEALTHCARE TRUST OF AMERICA turned its bottom line around by earning $0.11 versus -$0.10 in the prior year. This year, the market expects an improvement in earnings ($0.14 versus $0.11).
  • The gross profit margin for HEALTHCARE TRUST OF AMERICA is rather low; currently it is at 17.59%. 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 4.85% is significantly lower than the industry average.
  • Net operating cash flow has decreased to $29.15 million or 11.62% when compared to the same quarter last year. In addition, when comparing the cash generation rate to the industry average, the firm's growth is significantly lower.

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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