GEO - This High-Yield Dividend Stock Might Be in Trouble
Real estate investment trusts (REITs) are known for their high-yield dividends, and The GEO Group (NYSE: GEO) is no exception. The company, which owns and manages 123 private domestic secure facilities and post-correctional residential facilities with 93,000 total beds in the United States, Australia, Africa, and the United Kingdom, offers a dividend with an annualized payout of $1 a share. At the company's current share price, that gives it a yield of around 12.6%.
That might sound great ... until you find out why the yield is so high. GEO Group's stock price has fallen by more than 32% in the last year, so despite payout cuts this year and last year, the yield remains high. I'm not that worried about the safety of GEO's dividend, but the company appears to be a classic dividend trap because its revenues are trending downward.
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This High-Yield Dividend Stock Might Be in Trouble