Why Norwood Financial Corp. (NWFL) is a Top Dividend Stock for Your Portfolio

Whether it's through stocks, bonds, ETFs, or other types of securities, all investors love seeing their portfolios score big returns. But for income investors, generating consistent cash flow from each of your liquid investments is your primary focus.Cash flow can come from bond interest, interest from other types of investments, and, of course, dividends. A dividend is that coveted distribution of a company's earnings paid out to shareholders, and investors often view it by its dividend yield, a metric that measures the 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.Headquartered in Honesdale, Norwood Financial Corp. (NWFL) is a Finance stock that has seen a price change of -7.26% so far this year. The company is currently shelling out a dividend of $0.31 per share, with a dividend yield of 4.91%. This compares to the Banks - Northeast industry's yield of 2.69% and the S&P 500's yield of 1.5%.Looking at dividend growth, the company's current annualized dividend of $1.24 is up 3.3% from last year. Over the last 5 years, Norwood Financial Corp. has increased its dividend 5 times on a year-over-year basis for an average annual increase of 4.67%. 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. Norwood Financial's current payout ratio is 57%, meaning it paid out 57% of its trailing 12-month EPS as dividend.NWFL is expecting earnings to expand this fiscal year as well. The Zacks Consensus Estimate for 2025 is $2.68 per share, with earnings expected to increase 38.86% from the year ago period.Investors like dividends for a variety of different reasons, from tax advantages and decreasing overall portfolio risk to considerably improving stock investing profits. It's important to keep in mind that not all companies provide 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. During periods of rising interest rates, income investors must be mindful that high-yielding stocks tend to struggle. With that in mind, NWFL presents a compelling investment opportunity; it's not only an attractive dividend play, but the stock also boasts a strong Zacks Rank of #1 (Strong 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 Norwood Financial Corp. (NWFL): 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