Income investors focus on generating consistent cash flow from their investments, with dividends being a popular choice. Dividends are distributions of a company’s earnings to shareholders and are often measured by dividend yield. Illinois Tool Works (ITW), a company in the Industrial Products sector, has a dividend yield of 2.33%, higher than the industry average. ITW has a history of increasing its dividend annually by an average of 7.04%. The company’s current payout ratio is 57%, indicating that it pays out 57% of its earnings as dividends. ITW is expected to see earnings growth in the coming year. Dividends can provide various benefits to investors, such as improving profits, reducing risk, and offering tax advantages. While high-yield stocks may struggle during periods of rising interest rates, ITW remains a strong dividend play with a Zacks Rank of 3 (Hold).