10 Risky High Dividend Stocks To Sell

Published on October 14th, 2025 by Bob Ciura

Dividend stocks are inherently attractive to income investors, but not every dividend stock is a worthy investment. Income investors typically aim to steer clear of dividend cuts, as these not only diminish income but also tend to lead to a decline in the company’s share price following an announcement of a dividend reduction or suspension.

To assist investors, we have compiled a list of high dividend stocks boasting yields above 5%. You can download your free copy of this high dividend stocks list by clicking the link below:

Income investors should strive to avoid dividend cuts or eliminations whenever possible. The ten stocks featured in this article have Dividend Risk Scores of ‘D’ or ‘F’ (the lowest grades) in the Sure Analysis Research Database, with payout ratios exceeding 100%. A payout ratio above 100% indicates that the company is not generating sufficient earnings to support its dividend payout, increasing the likelihood of a future dividend cut or elimination.

Consequently, these ten high dividend stocks are rated as sells by Sure Dividend. The list is organized by current yield, from lowest to highest.

Table of Contents

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Risky High Dividend Stock #10: Cross Timbers Royalty Trust (CRT)

Cross Timbers Royalty Trust is an oil and gas trust established in 1991 by XTO Energy. Its unitholders enjoy a 90% net profit interest in producing properties across Texas, Oklahoma, and New Mexico, along with a 75% net profit interest in working interest properties in Texas and Oklahoma.

In mid-May, CRT reported its first-quarter results for fiscal 2025. Oil and gas volumes increased by 4% and 19%, respectively, compared to the previous year’s quarter. Although the average realized prices of oil and gas dipped by 6% and 10%, respectively, distributable cash flow (DCF) per unit grew by 12% due to higher volumes.

Click here to download our most recent Sure Analysis report on Cross Timbers Royalty Trust (CRT) (preview of page 1 of 3 shown below):

Risky High Dividend Stock #9: Timbercreek Financial Corp. (TBCRF)

Timbercreek Financial is a Canadian non-bank lender that specializes in shorter-duration, structured financing solutions for commercial real estate investors. The company primarily provides first-mortgage loans for income-producing properties, including multi-residential, retail, industrial, and office assets.

On July 30th, 2025, Timbercreek Financial reported its Q2 results. Distributable income for the quarter was $10.7 million, or $0.13 per share, down from $11.9 million, or $0.15 per share, in Q2 2024. This decline was attributed to a slightly lower average portfolio yield and a modest increase in expected credit loss, despite higher average portfolio balances.

Click here to download our most recent Sure Analysis report on TBCRF (preview of page 1 of 3 shown below):

Risky High Dividend Stock #8: PermRock Royalty Trust (PRT)

PermRock Royalty Trust, formed in late 2017 by Boaz Energy, focuses on acquiring, developing, and operating oil and natural gas properties in the Permian Basin, the most prolific oil-producing area in the U.S. On May 14th, 2025, the Trust reported first-quarter results, revealing net profits income of $1.71 million, up from $1.30 million in the prior year quarter.

Distributable income for the trust reached $1.47 million, a 31% increase from $1.12 million in the previous year, with distributable income per unit rising to $0.12 from $0.09.

Click here to download our most recent Sure Analysis report on PermRock Royalty Trust (PRT) (preview of page 1 of 3 shown below):

Risky High Dividend Stock #7: Stellus Capital (SCM)

Stellus Capital Management provides capital solutions to companies with EBITDA ranging from $5 million to $50 million, primarily through debt instruments. The company offers first lien, second lien, mezzanine, convertible debt, and equity investments to a diverse clientele in the U.S. and Canada.

On August 7th, 2025, Stellus reported second-quarter earnings, with net investment income at 34 cents per share. Total investment income was $25.7 million, slightly down from $26.6 million a year ago. Gross operating expenses rose to $17.1 million from $16.5 million year-over-year.

Click here to download our most recent Sure Analysis report on SCM (preview of page 1 of 3 shown below):

Risky High Dividend Stock #6: Mesa Royalty Trust (MTR)

Mesa Royalty Trust, established in 1979 and based in Houston, Texas, holds overriding royalty interests in natural gas and oil properties in the Hugoton field of Kansas and the San Juan Basin of New Mexico and Colorado. The Trust receives 11.44% of 90% of the net proceeds from production on these properties.

On August 14th, 2025, Mesa Royalty Trust released its Q2 results, reporting distributable income of $0.105 per unit before reserve adjustments, down from $0.1125 a year earlier. Royalty income came solely from the San Juan Basin, while production costs rose significantly.

Click here to download our most recent Sure Analysis report on MTR (preview of page 1 of 3 shown below):

Risky High Dividend Stock #5: Ellington Credit Co. (EARN)

Ellington Credit Co. specializes in acquiring, investing in, and managing residential mortgage and real estate-related assets, focusing primarily on residential mortgage-backed securities backed by U.S. government agencies.

On August 19th, 2025, Ellington reported its first fiscal quarter results, generating net income of $10.2 million, or $0.27 per share. The company achieved adjusted net investment income of $6.6 million, or $0.18 per share, with $36.6 million in cash and cash equivalents at quarter-end.

Click here to download our most recent Sure Analysis report on EARN (preview of page 1 of 3 shown below):

Risky High Dividend Stock #4: Prospect Capital (PSEC)

Prospect Capital Corporation is a Business Development Company (BDC) that provides private debt and equity to middle-market companies in the U.S. The company focuses on direct lending to owner-operated companies and sponsor-backed transactions.

On August 26th, 2025, Prospect reported its fourth-quarter and full-year results, revealing net interest income of 17 cents per share, down from 25 cents a year ago. Total revenue fell 21% year-over-year to $167 million, with total originations increasing but net originations declining significantly.

Click here to download our most recent Sure Analysis report on PSEC (preview of page 1 of 3 shown below):

Overly Risky High Dividend Stock #3: Orchid Island Capital (ORC)

Orchid Island Capital is a mortgage REIT managed by Bimini Advisors LLC, focusing on investing in residential mortgage-backed securities (RMBS). On July 24, 2025, the company reported a net loss of $33.6 million, or $0.29 per common share, driven by net interest income of $23.2 million and total expenses of $5.0 million.

Dividends declared were $0.36 per common share, with a book value per share of $7.21 by June 30, 2025, reflecting a total return of (4.66)%. Liquidity remained strong at $492.5 million, representing 54% of stockholders’ equity.

Click here to download our most recent Sure Analysis report on Orchid Island Capital, Inc. (ORC) (preview of page 1 of 3 shown below):

Risky High Dividend Stock #2: Horizon Technology Finance (HRZN)

Horizon Technology Finance Corp. is a BDC that provides venture capital to small and medium-sized companies in technology, life sciences, and healthcare sectors. On August 7th, 2025, Horizon announced its Q2 results, reporting total investment income of $24.5 million, down 4.5% year-over-year.

Net investment income per share fell to $0.28, down from $0.36 compared to Q2-2024. Despite this, management assured investors of the dividend’s stability by declaring three forward monthly dividends at a rate of $0.11.

Click here to download our most recent Sure Analysis report on HRZN (preview of page 1 of 3 shown below):

Risky High Dividend Stock #1: Oxford Square Capital (OXSQ)

Oxford Square Capital Corp. is a BDC specializing in financing early- and middle-stage businesses through loans and investments in collateralized loan obligations. As of the last quarter, the total fair value of Oxford Square’s investment portfolio was approximately $243.2 million across 61 positions.

On August 7th, 2025, Oxford Square Capital reported its Q2 results, generating about $9.5 million in total investment income, down from $10.2 million in Q1 2025. The weighted average yield on debt investments increased to 14.5%, while net investment income came in at $5.5 million, or $0.08 per share.

Click here to download our most recent Sure Analysis report on OXSQ (preview of page 1 of 3 shown below):

Final Thoughts

High dividend stocks can be enticing due to their attractive yields. However, income investors must be cautious not to fall into a dividend ‘trap’—purchasing a stock solely for its high yield, only to face a dividend cut or elimination later on. The ten risky dividend stocks listed here exhibit unsustainable dividends, as indicated by their high payout ratios. Therefore, income investors seeking quality dividend stocks for long-term income should consider selling these ten risky dividend stocks.

Additional Reading

If you are interested in discovering high-quality dividend growth stocks or other high-yield securities, the following Sure Dividend resources will be beneficial:

High-Yield Individual Security Research

Other Sure Dividend Resources