Atrium Mortgage Investment Corporation (TSE:AI): What You Have To Know Before Buying For The Upcoming Dividend

If you are interested in cashing in on Atrium Mortgage Investment Corporation's (TSX:AI) upcoming dividend of CA$0.08 per share, you only have 3 days left to buy the shares before its ex-dividend date, 30 May 2018, in time for dividends payable on the 12 June 2018. Is this future income a persuasive enough catalyst for investors to think about Atrium Mortgage Investment as an investment today? Below, 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 Atrium Mortgage Investment

5 questions I ask before picking a dividend stock

When assessing a stock as a potential addition to my dividend Portfolio, I look at these five areas:

• Is their annual yield among the top 25% of dividend payers?
• Does it consistently pay out dividends without missing a payment of significantly cutting payout?
• Has dividend per share risen in the past couple of years?
• Does earnings amply cover its dividend payments?
• Based on future earnings growth, will it be able to continue to payout dividend at the current rate?

How does Atrium Mortgage Investment fare?

Atrium Mortgage Investment has a trailing twelve-month payout ratio of 94.35%, meaning the dividend is not sufficiently covered by its earnings. 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's one type of stock you want to be reliable, it's dividend stocks and their stable income-generating ability. Unfortunately, it is really too early to view Atrium Mortgage Investment as a dividend investment. It has only been consistently paying dividends for 6 years, however, standard practice for reliable payers is to look for a 10-year minimum track record. Relative to peers, Atrium Mortgage Investment produces a yield of 7.29%, which is high for Mortgage stocks.

Next Steps:

After digging a little deeper into Atrium Mortgage Investment's yield, it's easy to see why you should be cautious investing in the company just 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. Below, I've compiled three relevant factors you should further examine:

1. Valuation: What is AI 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 AI is currently mispriced by the market.
2. Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on Atrium Mortgage Investment’s board and the CEO’s back ground.
3. Dividend Rockstars: Are there better dividend payers with stronger fundamentals out there? Check out our free list of these great stocks here.

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Simply Wall St analyst Simply Wall St and Simply Wall St have no position in any of the companies mentioned. This article is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.