What To Hold: 3 Hold-Rated Dividend Stocks TCAP, NRP, FGP

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 "Hold."

Triangle Capital Corporation

Dividend Yield: 9.00%

Triangle Capital Corporation (NYSE: TCAP) shares currently have a dividend yield of 9.00%.

Triangle Capital Corporation is a business development company specializing in private equity and mezzanine investments. The company has a P/E ratio of 11.96.

The average volume for Triangle Capital Corporation has been 162,800 shares per day over the past 30 days. Triangle Capital Corporation has a market cap of $797.6 million and is part of the financial services industry. Shares are up 18.2% year-to-date as of the close of trading on Friday.

EXCLUSIVE OFFER: See inside Jim Cramer's multi-million dollar charitable trust portfolio to see the stocks he thinks could be potential winners. Click here to see his holdings for 14-days FREE.

TheStreet Ratings rates Triangle Capital Corporation as a hold. The company's strengths can be seen in multiple areas, such as its revenue growth and expanding profit margins. However, as a counter to these strengths, we also find weaknesses including a generally disappointing performance in the stock itself, deteriorating net income and disappointing return on equity.

Highlights from the ratings report include:
  • The revenue growth greatly exceeded the industry average of 4.4%. Since the same quarter one year prior, revenues rose by 39.4%. 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 TRIANGLE CAPITAL CORP is currently very high, coming in at 77.31%. Regardless of TCAP's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, TCAP's net profit margin of 1.55% is significantly lower than the industry average.
  • TRIANGLE CAPITAL CORP 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, TRIANGLE CAPITAL CORP reported lower earnings of $1.04 versus $2.94 in the prior year. This year, the market expects an improvement in earnings ($2.15 versus $1.04).
  • Net operating cash flow has significantly decreased to -$39.08 million or 218.36% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
  • The share price of TRIANGLE CAPITAL CORP has not done very well: it is down 7.83% 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.

EXCLUSIVE OFFER: See inside Jim Cramer's multi-million dollar charitable trust portfolio to see the stocks he thinks could be potential winners. Click here to see his holdings for 14-days FREE.

Natural Resources Partners

Dividend Yield: 7.10%

Natural Resources Partners (NYSE: NRP) shares currently have a dividend yield of 7.10%.

Natural Resource Partners L.P., through its subsidiaries, owns, manages, and leases mineral properties in the United States. The company has a P/E ratio of 5.43.

The average volume for Natural Resources Partners has been 683,800 shares per day over the past 30 days. Natural Resources Partners has a market cap of $623.7 million and is part of the metals & mining industry. Shares are down 44.8% year-to-date as of the close of trading on Friday.

EXCLUSIVE OFFER: See inside Jim Cramer's multi-million dollar charitable trust portfolio to see the stocks he thinks could be potential winners. Click here to see his holdings for 14-days FREE.

TheStreet Ratings rates Natural Resources Partners as a hold. The company's strengths can be seen in multiple areas, such as its revenue growth, reasonable valuation levels and expanding profit margins. However, as a counter to these strengths, we also find weaknesses including feeble growth in the company's earnings per share, deteriorating net income and generally higher debt management risk.

Highlights from the ratings report include:
  • NRP's very impressive revenue growth greatly exceeded the industry average of 33.1%. Since the same quarter one year prior, revenues leaped by 50.8%. 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 rather high; currently it is at 50.23%. 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 6.93% compares favorably to the industry average.
  • 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 81.6% when compared to the same quarter one year ago, falling from $46.98 million to $8.65 million.
  • The debt-to-equity ratio is very high at 2.05 and currently higher than the industry average, implying increased risk associated with the management of debt levels within the company. Along with the unfavorable debt-to-equity ratio, NRP maintains a poor quick ratio of 0.85, which illustrates the inability to avoid short-term cash problems.

EXCLUSIVE OFFER: See inside Jim Cramer's multi-million dollar charitable trust portfolio to see the stocks he thinks could be potential winners. Click here to see his holdings for 14-days FREE.

Ferrellgas Partners

Dividend Yield: 8.20%

Ferrellgas Partners (NYSE: FGP) shares currently have a dividend yield of 8.20%.

Ferrellgas Partners, L.P. distributes and sells propane and related equipment and supplies primarily in the United States. The company transports propane to propane distribution locations, tanks on customers' premises, or to portable propane tanks delivered to retailers. The company has a P/E ratio of 41.51.

The average volume for Ferrellgas Partners has been 232,000 shares per day over the past 30 days. Ferrellgas Partners has a market cap of $2.0 billion and is part of the energy industry. Shares are up 12.6% year-to-date as of the close of trading on Friday.

EXCLUSIVE OFFER: See inside Jim Cramer's multi-million dollar charitable trust portfolio to see the stocks he thinks could be potential winners. Click here to see his holdings for 14-days FREE.

TheStreet Ratings rates Ferrellgas Partners as a hold. The company's strengths can be seen in multiple areas, such as its increase in net income, good cash flow from operations and growth in earnings per share. However, as a counter to these strengths, we also find weaknesses including a generally disappointing performance in the stock itself and poor profit margins.

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 Gas Utilities industry. The net income increased by 41.3% when compared to the same quarter one year prior, rising from $60.46 million to $85.46 million.
  • Net operating cash flow has significantly increased by 192.62% to $33.11 million when compared to the same quarter last year. In addition, FERRELLGAS PARTNERS -LP has also vastly surpassed the industry average cash flow growth rate of 11.33%.
  • FERRELLGAS PARTNERS -LP has improved earnings per share by 23.6% 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, FERRELLGAS PARTNERS -LP reported lower earnings of $0.40 versus $0.68 in the prior year. This year, the market expects an improvement in earnings ($0.71 versus $0.40).
  • The gross profit margin for FERRELLGAS PARTNERS -LP is rather low; currently it is at 23.02%. Regardless of FGP's low profit margin, it has managed to increase from the same period last year. Despite the mixed results of the gross profit margin, FGP's net profit margin of 12.83% compares favorably to the industry average.
  • In its most recent trading session, FGP has closed at a price level that was not very different from its closing price of one year earlier. This is probably due to its weak earnings growth as well as other mixed factors. Looking ahead, we do not see anything in this company's numbers that would change the one-year trend. It was down over the last twelve months; and it could be down again in the next twelve. Naturally, a bull or bear market could sway the movement of this stock.

EXCLUSIVE OFFER: See inside Jim Cramer's multi-million dollar charitable trust portfolio to see the stocks he thinks could be potential winners. Click here to see his holdings for 14-days FREE.

Other helpful dividend tools from TheStreet:

More from Markets

Dow, S&P 500 and Nasdaq Tumble After Trump Calls Off North Korea Summit

Dow, S&P 500 and Nasdaq Tumble After Trump Calls Off North Korea Summit

Inside Carnival's Mind Blowing New Horizon Cruise Ship (Video)

Inside Carnival's Mind Blowing New Horizon Cruise Ship (Video)

3 Must Reads on the Market From TheStreet's Top Columnists

3 Must Reads on the Market From TheStreet's Top Columnists

Automakers Slump as Trump Tariffs Threaten Both Manufacturers and Consumers

Automakers Slump as Trump Tariffs Threaten Both Manufacturers and Consumers

Jim Cramer: Does Saudi Arabia Think Oil Prices Are Too High?

Jim Cramer: Does Saudi Arabia Think Oil Prices Are Too High?