Dividend Challengers 2025: Top 25

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1. Innovative Industrial Properties, Inc. (NYSE:IIPR)

Dividend Yield as of April 29: 14.41%

Innovative Industrial Properties, Inc. (NYSE:IIPR), headquartered in California, supports the growth of the legal medical cannabis sector by offering investors a real estate-driven opportunity to tap into the cannabis industry. The company mainly supplies funding to the cannabis industry by carrying out sale-leaseback deals. It purchases properties such as dispensaries, cultivation sites, processing and manufacturing facilities, then leases them back to licensed operators, providing these businesses with the capital they need to grow and expand.

In the fourth quarter of 2024, Innovative Industrial Properties, Inc. (NYSE:IIPR) delivered results in line with expectations, posting adjusted diluted earnings per share of $1.36, matching analysts’ forecasts. Revenue came in slightly above projections at $76.7 million, compared to the anticipated $76 million. Adjusted funds from operations (AFFO), the key profitability measure for REITs, totaled $2.22 per share. Management expressed confidence in the cannabis industry’s growth outlook and plans to strengthen its tenant portfolio and strategically expand its real estate footprint. This approach is aimed at capturing upside from projected growth in state-legal cannabis sales, which are expected to reach $43.4 billion by 2027. Possible legislative developments could further support market expansion.

Innovative Industrial Properties, Inc. (NYSE:IIPR) currently pays a quarterly dividend of $1.40 per share for a dividend yield of 14.41%, as of April 29. The company has raised its dividends every year since its inception in 2016.

Overall, Innovative Industrial Properties, Inc. (NYSE:IIPR) ranks first on our dividend challengers list. While we acknowledge the potential of dividend stocks as an investment, our conviction lies in the belief that some deeply undervalued dividend stocks hold greater promise for delivering higher returns, and doing so within a shorter time frame. If you are looking for a deeply undervalued dividend stock that is more promising than IIPR but that trades at 10 times its earnings and grows its earnings at double digit rates annually, check out our report about the dirt cheap dividend stock.

READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks to Buy Now According to Billionaires.

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