AGNC Investment Corp. (Nasdaq: AGNC) is one of the most requested stocks here in the Safety Net column. It’s not surprising. AGNC pays a sky-high 9.6% yield and is a routine dividend cutter. So it makes sense that readers want to know whether the dividend is safe.

In 2018, I called AGNC’s dividend safety the worst I’d ever seen. Sure enough, since then, it cut its monthly dividend twice, taking it from $0.18 per share to $0.12.

In July 2021, I suggested things were improving, but I still didn’t trust the company. It was like a badly behaving spouse promising that things will be different.

Since then, AGNC has kept its word. It has put the toilet seat down, has stopped staying out late, and even remembered your anniversary.

So does it deserve your trust that the $0.12 per share monthly dividend is here to stay?

In July, I mentioned that the company was expected to generate $1.5 billion in net interest income while paying out $756 million in dividends in 2021. AGNC is a mortgage REIT, or real estate investment trust, so we measure its ability to pay the dividend by using net interest income – the difference between what AGNC makes lending money and what it costs to borrow the funds.

AGNC reported full-year results on Monday. Net interest income came in a little bit lower than the forecast in July. But the $1.29 billion easily covered the $752 million it paid in dividends for a very comfortable payout ratio of 58%.

This year, net interest income is projected to rise slightly to $1.33 billion. If the company pays the same amount in dividends in 2022 as it did in 2021, the payout ratio will dip to 57%.

But just like the spouse who never forgets past transgressions, Safety Net doesn’t forget all of AGNC’s dividend cuts in the past.

The good news is that last year, the company generated plenty of net interest income to afford its dividend, and it likely will again this year. The bad news is that management will not hesitate to slash the dividend when necessary. It’s proven that over and over.

The strong recent financial performance means the company gets an upgrade, but be careful about placing too much trust in the dividend.

Dividend Safety Rating: D