Why Bar Harbor Bankshares (BHB) is a Top Dividend Stock for Your Portfolio

All investors love getting big returns from their portfolio, whether it's through stocks, bonds, ETFs, or other types of securities. However, when you're an income investor, your primary focus is generating consistent cash flow from each of your liquid investments.While cash flow can come from bond interest or interest from other types of investments, income investors hone in on dividends. A dividend is the distribution of a company's earnings paid out to shareholders; it's often viewed by its dividend yield, a metric that measures a dividend as a percent of the current stock price. Many academic studies show that dividends account for significant portions of long-term returns, with dividend contributions exceeding one-third of total returns in many cases.Based in Bar Harbor, Bar Harbor Bankshares (BHB) is in the Finance sector, and so far this year, shares have seen a price change of 7.39%. The bank is currently shelling out a dividend of $0.32 per share, with a dividend yield of 3.9%. This compares to the Banks - Northeast industry's yield of 2.55% and the S&P 500's yield of 1.49%.Looking at dividend growth, the company's current annualized dividend of $1.28 is up 8.5% from last year. Over the last 5 years, Bar Harbor Bankshares has increased its dividend 5 times on a year-over-year basis for an average annual increase of 7.96%. Looking ahead, future dividend growth will be dependent on earnings growth and payout ratio, which is the proportion of a company's annual earnings per share that it pays out as a dividend. Bar Harbor's current payout ratio is 44%, meaning it paid out 44% of its trailing 12-month EPS as dividend.Looking at this fiscal year, BHB expects solid earnings growth. The Zacks Consensus Estimate for 2025 is $3.03 per share, representing a year-over-year earnings growth rate of 7.07%.Investors like dividends for many reasons; they greatly improve stock investing profits, decrease overall portfolio risk, and carry tax advantages, among others. But, not every company offers a quarterly payout.Big, established firms that have more secure profits are often seen as the best dividend options, but it's fairly uncommon to see high-growth businesses or tech start-ups offer their stockholders a dividend. Income investors have to be mindful of the fact that high-yielding stocks tend to struggle during periods of rising interest rates. That said, they can take comfort from the fact that BHB is not only an attractive dividend play, but is also a compelling investment opportunity with a Zacks Rank of #2 (Buy).5 Stocks Set to DoubleEach was handpicked by a Zacks expert as the #1 favorite stock to gain +100% or more in the coming year. While not all picks can be winners, previous recommendations have soared +112%, +171%, +209% and +232%.Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.Today, See These 5 Potential Home Runs >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Bar Harbor Bankshares, Inc. (BHB): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks