2 Days Left To Cash In On Lexington Realty Trust (NYSE:LXP) Dividend, Should You Buy?
Important news for shareholders and potential investors in Lexington Realty Trust (NYSE:LXP): The dividend payment of US$0.18 per share will be distributed into shareholder on 16 July 2018, and the stock will begin trading ex-dividend at an earlier date, 28 June 2018. Is this future income stream a compelling catalyst for dividend investors to think about the stock as an investment today? Let’s take a look at Lexington Realty Trust’s most recent financial data to examine its dividend characteristics in more detail. View out our latest analysis for Lexington Realty Trust
5 checks you should do on a dividend stock
If you are a dividend investor, you should always assess these five key metrics:
Is it paying an annual yield above 75% of dividend payers?
Has it paid dividend every year without dramatically reducing payout in the past?
Has the amount of dividend per share grown over the past?
Is its earnings sufficient to payout dividend at the current rate?
Will it have the ability to keep paying its dividends going forward?
How does Lexington Realty Trust fare?
Although REITs are expected to payout a high portion of the earnings, Lexington Realty Trust currently pays out more than double its net income, which suggests that the dividend is not well-covered by earnings by any means. Furthermore, analysts have not forecasted a dividends per share for the future, which makes it hard to determine the yield shareholders should expect, and whether the current payout is sustainable, moving forward.
Reliablity is an important factor for dividend stocks, particularly for income investors who want a strong track record of payment and a positive outlook for future payout. Dividend payments from Lexington Realty Trust have been volatile in the past 10 years, with some years experiencing significant drops of over 25%. This means that dividend hunters should probably steer clear of the stock, at least for now until the track record improves.
Relative to peers, Lexington Realty Trust has a yield of 7.90%, which is high for REITs stocks.
Next Steps:
After digging a little deeper into Lexington Realty Trust’s yield, it’s easy to see why you should be cautious investing in the company just for the dividend. But if you are not exclusively a dividend investor, the stock could still be an interesting investment opportunity. Given that this is purely a dividend analysis, I urge potential investors to try and get a good understanding of the underlying business and its fundamentals before deciding on an investment. I’ve put together three important factors you should look at:
Future Outlook: What are well-informed industry analysts predicting for LXP’s future growth? Take a look at our free research report of analyst consensus for LXP’s outlook.
Valuation: What is LXP worth today? Even if the stock is a cash cow, it’s not worth an infinite price. The intrinsic value infographic in our free research report helps visualize whether LXP is currently mispriced by the market.
Dividend Rockstars: Are there better dividend payers with stronger fundamentals out there? Check out our free list of these great stocks here.
To help readers see pass the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned.
