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

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 "Sell."

American Midstream Partners

Dividend Yield: 11.20%

American Midstream Partners (NYSE: AMID) shares currently have a dividend yield of 11.20%.

American Midstream Partners, LP is engaged in gathering, treating, processing, and transporting natural gas primarily in the Gulf Coast and Southeast regions of the United States.

The average volume for American Midstream Partners has been 71,800 shares per day over the past 30 days. American Midstream Partners has a market cap of $383.7 million and is part of the energy industry. Shares are down 15.7% year-to-date as of the close of trading on Thursday.

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TheStreet Ratings rates American Midstream Partners as a sell. The company's weaknesses can be seen in multiple areas, such as its deteriorating net income, disappointing return on equity, weak operating cash flow, poor profit margins and generally high debt management risk.

Highlights from the ratings report include:
  • 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 Oil, Gas & Consumable Fuels industry. The net income has significantly decreased by 1571.0% when compared to the same quarter one year ago, falling from -$5.64 million to -$94.30 million.
  • 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 Oil, Gas & Consumable Fuels industry and the overall market, AMERICAN MIDSTREAM PRTNRS LP's return on equity significantly trails that of both the industry average and the S&P 500.
  • Net operating cash flow has decreased to $3.24 million or 26.52% 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 gross profit margin for AMERICAN MIDSTREAM PRTNRS LP is rather low; currently it is at 22.12%. Despite the low profit margin, it has increased significantly from the same period last year. Despite the mixed results of the gross profit margin, AMID's net profit margin of -117.61% significantly underperformed when compared to the industry average.
  • AMID's debt-to-equity ratio of 0.87 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 0.09 is very low and demonstrates very weak liquidity.

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Southcross Energy Partners

Dividend Yield: 11.60%

Southcross Energy Partners (NYSE: SXE) shares currently have a dividend yield of 11.60%.

Southcross Energy Partners, L.P., together with its subsidiaries, provides natural gas gathering, processing, treating, compression, and transportation services in the United States. The company also offers natural gas liquid (NGL) fractionation and transportation services.

The average volume for Southcross Energy Partners has been 163,300 shares per day over the past 30 days. Southcross Energy Partners has a market cap of $329.4 million and is part of the utilities industry. Shares are down 12.6% year-to-date as of the close of trading on Thursday.

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TheStreet Ratings rates Southcross Energy Partners as a sell. The company's weaknesses can be seen in multiple areas, such as its deteriorating net income, disappointing return on equity, generally disappointing historical performance in the stock itself, poor profit margins and feeble growth in its earnings per share.

Highlights from the ratings report include:
  • 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 Oil, Gas & Consumable Fuels industry. The net income has significantly decreased by 440.1% when compared to the same quarter one year ago, falling from $0.68 million to -$2.30 million.
  • 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 Oil, Gas & Consumable Fuels industry and the overall market, SOUTHCROSS ENERGY PRTNRS LP's return on equity significantly trails that of both the industry average and the S&P 500.
  • The share price of SOUTHCROSS ENERGY PRTNRS LP has not done very well: it is down 19.89% 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. The fact that the stock is now selling for less than others in its industry in relation to its current earnings is not reason enough to justify a buy rating at this time.
  • The gross profit margin for SOUTHCROSS ENERGY PRTNRS LP is currently extremely low, coming in at 8.63%. Regardless of SXE's low profit margin, it has managed to increase from the same period last year. Despite the mixed results of the gross profit margin, the net profit margin of -1.03% trails the industry average.
  • SOUTHCROSS ENERGY PRTNRS LP 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 year. However, the consensus estimate suggests that this trend should reverse in the coming year. During the past fiscal year, SOUTHCROSS ENERGY PRTNRS LP reported poor results of -$1.07 versus -$0.72 in the prior year. This year, the market expects an improvement in earnings ($0.37 versus -$1.07).

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OCI Partners

Dividend Yield: 7.60%

OCI Partners (NYSE: OCIP) shares currently have a dividend yield of 7.60%.

OCI Partners LP produces and sells methanol and ammonia in the United States. It sells its products to industrial users and commercial traders for further processing or distribution. OCI GP LLC operates as the general partner of the company. The company has a P/E ratio of 11.68.

The average volume for OCI Partners has been 45,100 shares per day over the past 30 days. OCI Partners has a market cap of $1.4 billion and is part of the chemicals industry. Shares are up 8.5% year-to-date as of the close of trading on Thursday.

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TheStreet Ratings rates OCI Partners as a sell. The company's weaknesses can be seen in multiple areas, such as its unimpressive growth in net income and generally high debt management risk.

Highlights from the ratings report include:
  • 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 Chemicals industry. The net income has decreased by 22.9% when compared to the same quarter one year ago, dropping from $24.13 million to $18.60 million.
  • The debt-to-equity ratio is very high at 3.30 and currently higher than the industry average, implying increased risk associated with the management of debt levels within the company. Even though the debt-to-equity ratio is weak, OCIP's quick ratio is somewhat strong at 1.11, demonstrating the ability to handle short-term liquidity needs.
  • OCIP, with its decline in revenue, slightly underperformed the industry average of 4.8%. Since the same quarter one year prior, revenues slightly dropped by 5.5%. The declining revenue appears to have seeped down to the company's bottom line, decreasing earnings per share.
  • OCI PARTNERS LP's earnings per share declined by 23.3% in the most recent quarter compared to the same quarter a year ago. This year, the market expects an improvement in earnings ($1.46 versus $0.91).
  • Looking at the price performance of OCIP's shares over the past 12 months, there is not much good news to report: the stock is down 31.56%, and it has underformed the S&P 500 Index. In addition, the company's earnings per share are lower today than the year-earlier quarter.

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