Whether it's through stocks, bonds, ETFs, or other types of securities, all investors love seeing their portfolios score big returns. But when you're an income investor, your primary focus is generating consistent cash flow from each of your liquid investments.

Cash flow can come from bond interest, interest from other types of investments, and, of course, 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 make up large portions of long-term returns, and in many cases, dividend contributions surpass one-third of total returns.

First Bancorp (FBP Quick QuoteFBP - Free Report) is headquartered in San Juan, and is in the Finance sector. The stock has seen a price change of 15.76% since the start of the year. Currently paying a dividend of $0.18 per share, the company has a dividend yield of 3.35%. In comparison, the Banks - Southeast industry's yield is 2.38%, while the S&P 500's yield is 1.48%.

Looking at dividend growth, the company's current annualized dividend of $0.72 is up 12.5% from last year. Over the last 5 years, First Bancorp has increased its dividend 5 times on a year-over-year basis for an average annual increase of 29.65%. 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. First Bancorp's current payout ratio is 38%, meaning it paid out 38% of its trailing 12-month EPS as dividend.

Looking at this fiscal year, FBP expects solid earnings growth. The Zacks Consensus Estimate for 2025 is $1.96 per share, representing a year-over-year earnings growth rate of 8.29%.

From greatly improving stock investing profits and reducing overall portfolio risk to providing tax advantages, investors like dividends for a variety of different reasons. It's important to keep in mind that not all companies provide a quarterly payout.

High-growth firms or tech start-ups, for example, rarely provide their shareholders a dividend, while larger, more established companies that have more secure profits are often seen as the best dividend options. Income investors must be conscious of the fact that high-yielding stocks tend to struggle during periods of rising interest rates. With that in mind, FBP presents a compelling investment opportunity; it's not only an attractive dividend play, but the stock also boasts a strong Zacks Rank of #2 (Buy).