3 Sell-Rated Dividend Stocks: GLOP, CIO, KRO

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."

GasLog Partners

Dividend Yield: 11.30%

GasLog Partners (NYSE: GLOP) shares currently have a dividend yield of 11.30%.

GasLog Partners LP acquires, owns, and operates liquefied natural gas (LNG) carriers. The company provides LNG transportation services under long-term charters worldwide. As of February 16, 2016, it had a fleet of eight LNG carriers. The company was founded in 2014 and is based in Monaco. The company has a P/E ratio of 7.08.

The average volume for GasLog Partners has been 198,000 shares per day over the past 30 days. GasLog Partners has a market cap of $533.5 million and is part of the energy industry. Shares are up 17.4% 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 GasLog Partners as a sell. The company's weaknesses can be seen in multiple areas, such as its generally high debt management risk, weak operating cash flow and generally disappointing historical performance in the stock itself.

Highlights from the ratings report include:
  • The debt-to-equity ratio of 1.28 is relatively high when compared with the industry average, suggesting a need for better debt level management. Along with this, the company manages to maintain a quick ratio of 0.19, which clearly demonstrates the inability to cover short-term cash needs.
  • Net operating cash flow has decreased to $30.40 million or 36.49% when compared to the same quarter last year. Despite a decrease in cash flow of 36.49%, GASLOG PARTNERS LP is in line with the industry average cash flow growth rate of -39.44%.
  • GLOP's stock share price has done very poorly compared to where it was a year ago: Despite any rallies, the net result is that it is down by 32.56%, which is also worse that the performance of the S&P 500 Index. Investors have so far failed to pay much attention to the earnings improvements the company has managed to achieve over the last quarter. Naturally, the overall market trend is bound to be a significant factor. However, in one sense, the stock's sharp decline last year is a positive for future investors, making it cheaper (in proportion to its earnings over the past year) than most other stocks in its industry. But due to other concerns, we feel the stock is still not a good buy right now.
  • GASLOG PARTNERS LP 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 year. However, we anticipate underperformance relative to this pattern in the coming year. During the past fiscal year, GASLOG PARTNERS LP increased its bottom line by earning $2.90 versus $1.51 in the prior year. For the next year, the market is expecting a contraction of 19.1% in earnings ($2.35 versus $2.90).
  • The gross profit margin for GASLOG PARTNERS LP is currently very high, coming in at 78.92%. Regardless of GLOP's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, GLOP's net profit margin of 39.07% significantly outperformed against the 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.

City Office REIT

Dividend Yield: 7.60%

City Office REIT (NYSE: CIO) shares currently have a dividend yield of 7.60%.

City Office REIT, Inc is an equity real estate investment trust. The fund invests in the real estate markets of the United States. It acquires, own and operate high-quality office properties. City Office REIT, Inc was formed in November 26, 2013 and is domiciled in the United States.

The average volume for City Office REIT has been 27,200 shares per day over the past 30 days. City Office REIT has a market cap of $154.7 million and is part of the real estate industry. Shares are down 1.1% 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 City Office REIT as a sell. The company's weaknesses can be seen in multiple areas, such as its deteriorating net income and poor profit margins.

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 Real Estate Investment Trusts (REITs) industry. The net income has significantly decreased by 41.4% when compared to the same quarter one year ago, falling from -$1.77 million to -$2.50 million.
  • The gross profit margin for CITY OFFICE REIT INC is rather low; currently it is at 19.73%. Regardless of CIO's low profit margin, it has managed to increase from the same period last year. Despite the mixed results of the gross profit margin, CIO's net profit margin of -17.09% significantly underperformed when compared to the industry average.
  • After a year of stock price fluctuations, the net result is that CIO's price has not changed very much. Although its weak earnings growth may have played a role in this flat result, don't lose sight of the fact that the performance of the overall market, as measured by the S&P 500 Index, was essentially similar. 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.
  • Compared to other companies in the Real Estate Investment Trusts (REITs) industry and the overall market, CITY OFFICE REIT INC's return on equity significantly trails that of both the industry average and the S&P 500.
  • Net operating cash flow has significantly increased by 122.34% to $6.89 million when compared to the same quarter last year. In addition, CITY OFFICE REIT INC has also vastly surpassed the industry average cash flow growth rate of 0.99%.

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.

Kronos Worldwide

Dividend Yield: 9.20%

Kronos Worldwide (NYSE: KRO) shares currently have a dividend yield of 9.20%.

Kronos Worldwide, Inc. produces and markets titanium dioxide pigments (TiO2) worldwide. The company has a P/E ratio of 1.68.

The average volume for Kronos Worldwide has been 413,500 shares per day over the past 30 days. Kronos Worldwide has a market cap of $757.9 million and is part of the chemicals industry. Shares are up 7.1% 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 Kronos Worldwide as a sell. The company's weaknesses can be seen in multiple areas, such as its deteriorating net income, disappointing return on equity, poor profit margins, generally disappointing historical performance in the stock itself 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 Chemicals industry. The net income has significantly decreased by 137.0% when compared to the same quarter one year ago, falling from $31.90 million to -$11.80 million.
  • Return on equity has greatly decreased when compared to its ROE from the same quarter one year prior. This is a signal of major weakness within the corporation. Compared to other companies in the Chemicals industry and the overall market, KRONOS WORLDWIDE INC's return on equity significantly trails that of both the industry average and the S&P 500.
  • The gross profit margin for KRONOS WORLDWIDE INC is rather low; currently it is at 15.96%. It has decreased significantly from the same period last year. Along with this, the net profit margin of -3.50% is significantly below that of the industry average.
  • Despite any intermediate fluctuations, we have only bad news to report on this stock's performance over the last year: it has tumbled by 46.00%, worse than the S&P 500's performance. Consistent with the plunge in the stock price, the company's earnings per share are down 135.71% compared to the year-earlier quarter. Naturally, the overall market trend is bound to be a significant factor. However, in one sense, the stock's sharp decline last year is a positive for future investors, making it cheaper (in proportion to its earnings over the past year) than most other stocks in its industry. But due to other concerns, we feel the stock is still not a good buy right now.
  • KRONOS WORLDWIDE 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. This company has reported somewhat volatile earnings recently. We feel it is likely to report a decline in earnings in the coming year. During the past fiscal year, KRONOS WORLDWIDE INC turned its bottom line around by earning $0.86 versus -$0.87 in the prior year. For the next year, the market is expecting a contraction of 83.1% in earnings ($0.15 versus $0.86).

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

Apple and GE Switch Roles; Musk's Super Control of Tesla Explained -- ICYMI

Apple and GE Switch Roles; Musk's Super Control of Tesla Explained -- ICYMI

Trump May Be More to Blame For Higher Oil Prices Than OPEC

Trump May Be More to Blame For Higher Oil Prices Than OPEC

Dow Falls Over 200 Points as Apple's Slump Offsets Gains in General Electric

Dow Falls Over 200 Points as Apple's Slump Offsets Gains in General Electric

Week Ahead: Major Earnings on Tap as Wall Street Readies for Geopolitical Moves

Week Ahead: Major Earnings on Tap as Wall Street Readies for Geopolitical Moves

3 Hot Reads From TheStreet's Top Premium Columnists

3 Hot Reads From TheStreet's Top Premium Columnists