Important news for shareholders and potential investors in Easterly Government Properties Inc (NYSE:DEA): The dividend payment of $0.26 per share will be distributed into shareholder on 28 June 2018, and the stock will begin trading ex-dividend at an earlier date, 08 June 2018. What does this mean for current shareholders and potential investors? Below, I will explain how holding Easterly Government Properties can impact your portfolio income stream, by analysing the stock’s most recent financial data and dividend attributes. Check out our latest analysis for Easterly Government Properties
How I analyze a dividend stock
Whenever I am looking at a potential dividend stock investment, I always check these five metrics:
- Is it the top 25% annual dividend yield payer?
- Does it consistently pay out dividends without missing a payment of significantly cutting payout?
- Has the amount of dividend per share grown over the past?
- Is its earnings sufficient to payout dividend at the current rate?
- Will it be able to continue to payout at the current rate in the future?
How does Easterly Government Properties fare?
Although REITs are expected to payout a high portion of the earnings, Easterly Government Properties 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. If there is one thing that you want to be reliable in your life, it’s dividend stocks and their constant income stream. Unfortunately, it is really too early to view Easterly Government Properties as a dividend investment. It has only been consistently paying dividends for 3 years, however, standard practice for reliable payers is to look for a 10-year minimum track record. Relative to peers, Easterly Government Properties has a yield of 5.09%, which is high for REITs stocks.
Now you know to keep in mind the reason why investors should be careful investing in Easterly Government Properties 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 relevant aspects you should look at:
- Future Outlook: What are well-informed industry analysts predicting for DEA’s future growth? Take a look at our free research report of analyst consensus for DEA’s outlook.
- Valuation: What is DEA 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 DEA 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.