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On the 20 April 2018, Independence Realty Trust Inc (NYSE:IRT) will be paying shareholders an upcoming dividend amount of $0.18 per share. However, investors must have bought the company’s stock before 03 April 2018 in order to qualify for the payment. That means you have only 3 days left! Should you diversify into Independence Realty Trust and boost your portfolio income stream? Well, keep on reading because today, I’m going to look at the latest data and analyze the stock and its dividend property in further detail. Check out our latest analysis for Independence Realty Trust

5 questions I ask before picking a dividend stock

Whenever I am looking at a potential dividend stock investment, I always check these five metrics:

• Is its annual yield among the top 25% of dividend-paying companies?

• Does it consistently pay out dividends without missing a payment of significantly cutting payout?

• Has dividend per share amount increased over the past?

• Can it afford to pay the current rate of dividends from its earnings?

• Based on future earnings growth, will it be able to continue to payout dividend at the current rate?

How does Independence Realty Trust fare?

REITs are a special-case dividend payer. This is because a high percentage of their earnings are required to be paid out as dividends. Independence Realty Trust has a trailing twelve-month payout ratio of 174.81%, meaning that a portion of dividend payments are funded by retained earnings. Furthermore, analysts are forecasting the payout ratio to exceed earnings going forward, leading to a future of uncertainty around the stability of IRT’s dividend income. If there is one thing that you want to be reliable in your life, it’s dividend stocks and their constant income stream. The reality is that it is too early to consider Independence Realty Trust as a dividend investment. It has only been consistently paying dividends for 5 years, however, standard practice for reliable payers is to look for a 10-year minimum track record. Relative to peers, Independence Realty Trust has a yield of 7.84%, which is high for REITs stocks.

Next Steps:

Now you know to keep in mind the reason why investors should be careful investing in Independence Realty Trust for the dividend. On the other hand, if you are not strictly just a dividend investor, the stock could still be offering some interesting investment opportunities. Given that this is purely a dividend analysis, you should always research extensively before deciding whether or not a stock is an appropriate investment for you. I always recommend analysing the company’s fundamentals and underlying business before making an investment decision. I’ve put together three pertinent factors you should further research: