When it comes to investing, many people dream of earning big returns from their financial portfolios. For income investors, the focus is on generating consistent cash flow from their investments, whether it be through stocks, bonds, ETFs, or other securities.
One way to earn cash flow is through dividends, which are distributions of a company’s earnings paid out to shareholders. Dividends can make up a significant portion of long-term returns, with studies showing that they often exceed one-third of total returns.
One company that income investors may want to consider is Air Products and Chemicals (APD). This company, based in Allentown and in the Basic Materials sector, has seen a price change of -6.63% so far this year. Currently, APD is offering a dividend of $1.77 per share, with a dividend yield of 2.77%, which is higher than the industry average.
APD has a history of increasing its dividend, with an average annual increase of 9.20% over the last 5 years. The company’s current payout ratio is 60%, meaning it pays out 60% of its earnings per share as dividends. Analysts expect earnings to grow by 6.86% this fiscal year.
While not all companies offer dividends, APD presents a compelling investment opportunity for income investors. It is not only a strong dividend play but also holds a Zacks Rank of 3 (Hold). During periods of rising interest rates, high-yielding stocks may struggle, but APD remains a solid choice for those seeking consistent cash flow from their investments.