Sure thing, let’s dive right in—messy journey expected!
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Hey there, folks! So, I stumbled upon Innovative Industrial Properties (IIPR—fancy ticker name, right?). Last time I poked into this, it was doing okayish with a 7% dividend yield, and it got this shining “A” for dividend safety. Gotta love those ratings, even though they can be kinda deceiving sometimes.
Fast forward almost a year. The dividend kinda sat there like a rock at $1.90 quarterly. Not much excitement there. But, oh boy, the stock price? Yikes. It literally took a dive, cutting itself in half. Ouch! But hey, that jacked up the yield to 13.6%. Silver lining or just another distraction?
Okay, so can these guys keep up with paying this almost too-good-to-be-true yield? Last time I checked, they were all about growing their funds from operations (FFO). Sounds all techy, but really it’s just the money they make. They were supposed to rake in $250 million in FFO last year. Instead, they came in at $231 million. Close enough? Nah. Especially, considering they did slightly better at $232 million back in 2023. So, what happened here?
A miss like that gets them a little slap on the wrist in the safety ratings. This year doesn’t look too hot either, with FFO figures likely shrinking to $191 million. Not exactly the kind of news you wanna hear when you’re holding onto their stock.
Now, if they can manage FFO at just $191 million in 2025, it won’t be enough to cover $211 million in expected dividends. A bit of a math problem there. I mean, REITs gotta pay most of their dough to shareholders, but even with this adjusted payout ratio trick, 110% is overboard.
Here’s another one—they’ve been nudging up dividends for nine years straight. Guess they wanted to keep the streak alive. Not looking likely right now though. If growth vibes come back, that’ll be awesome! But as it stands, who knows?
Anyway! Or actually, wait a sec—before I lose my train of thought—yeah, they’re dangling on a thread here. Could be a dividend chop incoming. So, sticking a “D” on their dividend safety seems fair.
What do you want me to dive into next? Got any stocks lurking in your mind? Pop the ticker in the comments and I’ll give it a whirl!
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