Octopus Renewables Infrastructure Trust plc (LON:ORIT) is about to trade ex-dividend in the next 3 days. Typically, the ex-dividend date is one business day before the record date which is the date on which a company determines the shareholders eligible to receive a dividend. The ex-dividend date is an important date to be aware of as any purchase of the stock made on or after this date might mean a late settlement that doesn't show on the record date. This means that investors who purchase Octopus Renewables Infrastructure Trust's shares on or after the 16th of May will not receive the dividend, which will be paid on the 31st of May.

The company's upcoming dividend is UK￡0.015 a share, following on from the last 12 months, when the company distributed a total of UK￡0.058 per share to shareholders. Based on the last year's worth of payments, Octopus Renewables Infrastructure Trust stock has a trailing yield of around 7.8% on the current share price of UK￡0.745. If you buy this business for its dividend, you should have an idea of whether Octopus Renewables Infrastructure Trust's dividend is reliable and sustainable. So we need to investigate whether Octopus Renewables Infrastructure Trust can afford its dividend, and if the dividend could grow.

Check out our latest analysis for Octopus Renewables Infrastructure Trust

Dividends are usually paid out of company profits, so if a company pays out more than it earned then its dividend is usually at greater risk of being cut. Octopus Renewables Infrastructure Trust paid out a disturbingly high 258% of its profit as dividends last year, which makes us concerned there's something we don't fully understand in the business.

Generally, the higher a company's payout ratio, the more the dividend is at risk of being reduced.

Click here to see how much of its profit Octopus Renewables Infrastructure Trust paid out over the last 12 months.

Have Earnings And Dividends Been Growing?

Stocks with flat earnings can still be attractive dividend payers, but it is important to be more conservative with your approach and demand a greater margin for safety when it comes to dividend sustainability. If earnings decline and the company is forced to cut its dividend, investors could watch the value of their investment go up in smoke. With that in mind, we're not enthused to see that Octopus Renewables Infrastructure Trust's earnings per share have remained effectively flat over the past three years. We'd take that over an earnings decline any day, but in the long run, the best dividend stocks all grow their earnings per share.