High yield often translates to high risk. This means income investors must exercise caution when considering which dividend stocks to buy. 

However, the need to be cautious doesn't mean that you have to avoid high-yield dividend stocks altogether. Some of them actually aren't all that risky.

One comes to mind that income investors will probably especially like. Buying $5,000 of high-yield dividend stock Crown Castle (CCI -0.03%) would be a brilliant move right now.

A towering business

Crown Castle operates over 40,000 telecommunications towers throughout the U.S. It owns roughly 120,000 small cells that boost capacity in areas with high data network traffic. In addition, the company has around 85,000 miles of fiber that carry voice and data from its towers and small cells to homes and businesses.

But Crown Castle isn't a telecom company in the traditional sense. Instead, it's organized as a real estate investment trust (REIT). The company leases its assets to telecom companies. Three telecom giants -- AT&T, T-Mobile, and Verizon -- accounted for close to 75% of Crown Castle's site rental revenue last year.

Thanks to contract escalators, Crown Castle's revenue is poised to grow regardless of what happens in the telecom industry. However, the REIT should also benefit from a major tailwind. Mobile data usage has exploded in the U.S., increasing 108x between 2010 and 2020. The transition to 5G (and potentially 6G in the future) should serve as a growth driver for Crown Castle for years to come. 

About that dividend

As a REIT, Crown Castle must return at least 90% of its income to shareholders in the form of dividends to avoid paying federal taxes. The company's dividend yield currently tops 5%. 

Since 2016, Crown Castle has increased its dividend by a compound annual growth rate of 9%. The company expects to deliver an average dividend increase of between 7% and 8% each year over the long term. 

Investors should expect somewhat lower dividend increases in 2024 and 2025. Crown Castle is feeling the impact of higher interest rates and some lease cancellations resulting from the merger of T-Mobile and Sprint. However, the company still looks to hit its long-term dividend increase target, with growth reaccelerating after the next couple of years.

Crown Castle shouldn't have any problems keeping the dividends flowing. The company has an investment-grade balance sheet. The telecom assets it leases are mission critical. Crown Castle should especially have solid growth opportunities in the small cell market.

Two negatives

There are two negatives for Crown Castle that income investors should know about. I've already mentioned one -- slowing growth due to higher interest rates and Sprint's cancellations. The other is the stock's valuation, with shares trading at 34.6 times forward earnings. However, I don't think that either of these issues is overly problematic.

First, Crown Castle fully expects to return to stronger growth. The overall trends in mobile data usage support the company's optimism, in my view.

It's important to note that Crown Castle isn't hurting all that much, even with its current challenges. Revenue in the first quarter of 2023 rose 3% year over year, with adjusted funds from operations (AFFO) up 2%. The REIT continues to project AFFO growth in full-year 2023.

Second, while the stock valuation is high compared to the S&P 500, it's low compared to Crown Castle's historical levels. I won't argue that the stock is cheap -- it isn't. However, I don't see the valuation as a showstopper.

A brilliant move

My take is that Crown Castle presents an attractive opportunity for income investors. You can lock in an especially juicy dividend. The company's underlying business remains solid. Concerns about its near-term challenges are more than priced into the share price. Therefore, buying shares of this high-yield dividend stock truly could be a brilliant move.