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." Navios Maritime Partners L.P Dividend Yield: 10.60% Navios Maritime Partners L.P (NYSE: NMM) shares currently have a dividend yield of 10.60%. Navios Maritime Partners L.P. is engaged in the ownership and operation of dry cargo vessels in Europe, Asia, North America, and Australia. The company has a P/E ratio of 18.70. The average volume for Navios Maritime Partners L.P has been 445,000 shares per day over the past 30 days. Navios Maritime Partners L.P has a market cap of $1.3 billion and is part of the transportation industry. Shares are down 15.5% year-to-date as of the close of trading on Friday. STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more. TheStreet Ratings rates Navios Maritime Partners L.P as a hold. The company's strengths can be seen in multiple areas, such as its revenue growth, expanding profit margins and increase in stock price during the past year. However, as a counter to these strengths, we also find weaknesses including disappointing return on equity, weak operating cash flow and deteriorating net income. Highlights from the ratings report include:
- Despite its growing revenue, the company underperformed as compared with the industry average of 20.8%. Since the same quarter one year prior, revenues rose by 18.7%. 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 NAVIOS MARITIME PARTNERS LP is currently very high, coming in at 93.07%. It has increased from the same quarter the previous year. Along with this, the net profit margin of 23.58% significantly outperformed against the industry average.
- NMM's debt-to-equity ratio of 0.72 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 5.40 is very high and demonstrates very strong liquidity.
- Net operating cash flow has decreased to $32.16 million or 21.10% when compared to the same quarter last year. Despite a decrease in cash flow of 21.10%, NAVIOS MARITIME PARTNERS LP is still significantly exceeding the industry average of -93.11%.
- 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. When compared to other companies in the Marine industry and the overall market, NAVIOS MARITIME PARTNERS LP's return on equity is below that of both the industry average and the S&P 500.
- You can view the full Navios Maritime Partners L.P Ratings Report.
- NRP's revenue growth has slightly outpaced the industry average of 1.9%. Since the same quarter one year prior, revenues slightly increased by 2.8%. 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 NATURAL RESOURCE PARTNERS LP is currently very high, coming in at 81.79%. Despite the high profit margin, it has decreased significantly from the same period last year. Despite the mixed results of the gross profit margin, NRP's net profit margin of 38.69% significantly outperformed against the industry.
- 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 Oil, Gas & Consumable Fuels industry and the overall market on the basis of return on equity, NATURAL RESOURCE PARTNERS LP has underperformed in comparison with the industry average, but has exceeded that of the S&P 500.
- Currently the debt-to-equity ratio of 1.80 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 the unfavorable debt-to-equity ratio, NRP maintains a poor quick ratio of 0.93, which illustrates the inability to avoid short-term cash problems.
- Net operating cash flow has decreased to $61.01 million or 23.48% 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.
- You can view the full Natural Resources Partners Ratings Report.
- BDCV's very impressive revenue growth greatly exceeded the industry average of 5.1%. Since the same quarter one year prior, revenues leaped by 2600.0%. Growth in the company's revenue appears to have helped boost the earnings per share.
- BDCA VENTURE INC 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, BDCA VENTURE INC turned its bottom line around by earning $0.26 versus -$0.21 in the prior year. This year, the market expects an improvement in earnings ($0.30 versus $0.26).
- This stock's share value has moved by only 31.77% over the past year. Despite the heavy decline in its share price, this stock is still more expensive (when compared to its current earnings) than most other companies in its industry.
- Net operating cash flow has significantly decreased to -$5.05 million or 568.51% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
- You can view the full BDCA Venture Ratings Report.
- Our dividend calendar.