the FTSE 250 indexMostly known as UK growth stocks. But it still has a wide range of dividend-paying companies on its list, many of which are currently offering impressive dividend yields.

This list includes the polymer specialist Vectrex (LSE:VCT), whose shares are offering an impressive yield of 8.6% at the moment. That's more than double the stock market average. With a dividend per share of 59.56p, buying 8,394 shares is enough to unlock a passive annual income stream of £5,000.

So is this a no-brainer?

Check profits

High returns are often questionable and can be an early warning signal that something is wrong. Victrex has certainly had its fair share of challenges lately.

The global slowdown in the manufacturing sector has caused demand for PEEK polymer materials to suffer, resulting in lower revenues and profits. Market conditions have since begun to improve, with polymer volumes rebounding. However, demand from the medical sector remains weak – a problem given that most Victrex products are sold at a high profit margin.

However, management is guiding for better times ahead with further volume growth, better internal cost controls, improved utilization, and increased production at the new manufacturing plant in China.

This confidence is also reflected in the decision not to cut the dividend. Once earnings rebounded, allowing coverage to recover to 2.0 (from around 1.3 as of March), leadership set out its ambitions to resume its long history of increasing dividends every year.

So, provided there are no spanners in the works, it looks like high EPS is here to stay, before it eventually expands further in the future. But why aren't more investors seizing this opportunity?

What could go wrong?

There are a wide range of factors responsible for the weak sentiment surrounding the FTSE 250 stock. It doesn't help that the company has missed several targets in the past few years, nor that it recently lowered pricing guidance for its polymers due to an unfavorable product mix and adverse foreign exchange movements.

As such, investors appear to be holding this business within a very short range. Further unfavorable currency fluctuations could lead to further loss of profits, especially if medical weakness persists. While the company is a significant cash-generating enterprise, a delayed end-market recovery combined with rising macroeconomic uncertainty may force management to readjust shareholder payouts.

In other words, even with high management conviction, the risk of a dividend cut is still far from zero. Of course, this also means that if things go better than expected, the stock price could recover quickly with investor sentiment boosted.

Bottom line

In the long term, long-term demand for lightweight, high-performance polymers bodes well for Victrex and its stock price. But in the short term, this work remains full of uncertainty. So, while purchasing some stocks may open the door to significant passive income, such an investment comes with elevated risks that investors must carefully consider.

I'm keeping a close eye on this income stock, and if it shows more signs of recovery, I may decide to participate in it. But for now, I'm looking at other FTSE 250 opportunities for my income portfolio.