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."Harvest Capital Credit Dividend Yield: 10.70% Harvest Capital Credit (NASDAQ: HCAP) shares currently have a dividend yield of 10.70%. Harvest Capital Credit LLC is a business development company providing structured credit to small businesses. The company has a P/E ratio of 11.64. The average volume for Harvest Capital Credit has been 19,700 shares per day over the past 30 days. Harvest Capital Credit has a market cap of $78.1 million and is part of the financial services industry. Shares are down 16.3% 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 Harvest Capital Credit as a hold. The company's strengths can be seen in multiple areas, such as its robust revenue growth, impressive record of earnings per share growth and compelling growth in net income. However, as a counter to these strengths, we find that the stock has had a generally disappointing performance in the past year. Highlights from the ratings report include:
- HCAP's very impressive revenue growth greatly exceeded the industry average of 1.0%. Since the same quarter one year prior, revenues leaped by 70.9%. Growth in the company's revenue appears to have helped boost the earnings per share.
- HARVEST CAPITAL CREDIT CORP reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. This year, the market expects an improvement in earnings ($1.34 versus $0.47).
- The gross profit margin for HARVEST CAPITAL CREDIT CORP is rather high; currently it is at 57.09%. Despite the high profit margin, it has decreased significantly from the same period last year. Despite the mixed results of the gross profit margin, HCAP's net profit margin of 68.01% significantly outperformed against the industry.
- HCAP has underperformed the S&P 500 Index, declining 15.19% from its price level of one year ago.
- When compared to other companies in the Capital Markets industry and the overall market, HARVEST CAPITAL CREDIT CORP's return on equity is below that of both the industry average and the S&P 500.
- You can view the full Harvest Capital Credit Ratings Report.
- CPG's very impressive revenue growth greatly exceeded the industry average of 6.5%. Since the same quarter one year prior, revenues leaped by 66.8%. Growth in the company's revenue appears to have helped boost the earnings per share.
- The gross profit margin for CRESCENT POINT ENERGY CORP is currently very high, coming in at 82.16%. It has increased from the same quarter the previous year. Along with this, the net profit margin of 23.04% significantly outperformed against the industry average.
- CPG's debt-to-equity ratio is very low at 0.25 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Even though the company has a strong debt-to-equity ratio, the quick ratio of 0.43 is very weak and demonstrates a lack of ability to pay short-term obligations.
- 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 Oil, Gas & Consumable Fuels industry and the overall market, CRESCENT POINT ENERGY CORP's return on equity significantly trails that of both the industry average and the S&P 500.
- CPG has underperformed the S&P 500 Index, declining 17.21% from its price level of one year ago. Turning toward the future, the fact that the stock has come down in price over the past year should not necessarily be interpreted as a negative; it could be one of the factors that may help make the stock attractive down the road. Right now, however, we believe that it is too soon to buy.
- You can view the full Crescent Point Energy Ratings Report.
- IRT's very impressive revenue growth greatly exceeded the industry average of 13.8%. Since the same quarter one year prior, revenues leaped by 172.9%. 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.
- Compared to other companies in the Real Estate Investment Trusts (REITs) industry and the overall market, INDEPENDENCE REALTY TRUST'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 when compared to that of the S&P 500 and the Real Estate Investment Trusts (REITs) industry. The net income has significantly decreased by 121.8% when compared to the same quarter one year ago, falling from $0.26 million to -$0.06 million.
- The gross profit margin for INDEPENDENCE REALTY TRUST is rather low; currently it is at 17.02%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of -0.42% is significantly below that of the industry average.
- You can view the full Independence Realty Ratings Report.
- Our dividend calendar.