IIPR - Is This Stock's 8% Dividend Yield Due for a Cut?
If you're investing in a stock with a dividend that yields 8% or more, you should be careful and take a close look at its business. While monster-sized payouts may look attractive, the danger is that they may not end up lasting. Even real estate investment trusts (REITs) that generate recurring revenue from their tenants are by no means safe bets.
Innovative Industrial Properties (NYSE: IIPR) is a cannabis-focused REIT that pays a yield of 8.2% right now. But with some of its clients struggling, could the company's dividend be in danger, and should investors be thinking twice about buying the pot stock ?
A big concern for investors in REITs is the safety of the tenants. If tenants are struggling and are unable to pay rent, that impacts the REIT's bottom line. That in turn can impact its ability to continue to pay the same dividend as it has in the past.
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Is This Stock's 8% Dividend Yield Due for a Cut?