An updated edition of the June 8, 2025, article.

While searching for income-generating equities, investors primarily focus on stocks with high dividend yield. Although high-dividend-paying stocks generate a steady stream of income for investors, they do not reflect other ways a company returns money to its shareholders, such as share buybacks. To get a holistic view, an investor should consider shareholders’ yield instead of dividend yield alone. Apart from dividend payment and share buybacks, shareholders’ yield also includes debt reduction, which generally has a positive impact on ROCE by improving capital efficiency and reducing financial risk.

Shareholders’ Yield Calculation

At its core, shareholders’ yield captures all the ways in which a company can return cash (or value) to its shareholders:

• Dividend Yield = cash dividends distributed over market cap.
   
• Net Buyback Yield = (share repurchases – share issuances) ÷ market cap
   
• Debt Reduction Yield = net debt paydown (short + long term) ÷ market cap.
   

Hence:

Shareholder’s Yield = Dividend Yield + Net Buyback Yield + Debt Reduction Yield

Key Benefits for Investors

By focusing on shareholders’ yield, investors can make more informed investment decisions by highlighting companies that effectively reward their shareholders. It provides a more comprehensive view of a company's capital allocation beyond simple dividend payments.

Moreover, companies demonstrate fiscal responsibility by improving their balance sheets and resilience during market downturns through debt reduction. Aggressive buybacks signal management’s belief that the stock is undervalued. By reducing the number of outstanding shares, buybacks boost per-share earnings and enhance intrinsic value for continuing investors.

The shareholders’ yield is also an effective comparison tool for companies across different industries on how efficiently they return capital, helping identify strong performers. The higher the shareholder yield, the better, as it often signals steady income streams from dividends and potential capital appreciation from buybacks, leading to superior long-term performance.

By focusing on firms like Canadian Natural Resources Limited (CNQ Quick QuoteCNQ - Free Report) , Bain Capital Specialty Finance (BCSF Quick QuoteBCSF - Free Report) , CSX (CSX Quick QuoteCSX - Free Report) and Verizon Communications (VZ Quick QuoteVZ - Free Report) , which boast high shareholder yield, investors can identify opportunities that not only provide income but also enhance overall portfolio returns.

As market valuations stretch and economic cycles shift, focusing on shareholder-friendly companies may prove to be not just a smart defensive strategy, but a potent wealth-building one. Investors would do well to look beyond headlines and favor those businesses that consistently reward their shareholders in tangible, trackable ways.

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4 Top Stocks With Impressive Shareholder Yield

Canadian Natural Resources Limited stands out as a strong candidate for high shareholder yield due to its attractive dividend payments, consistent share buybacks and effective debt management. The company offers a competitive dividend yield of around 5.28%.

CNQ has increased its dividend payout 17 times in the past five years, reflecting an annualized dividend growth rate of 23.3%. The payout ratio of 64% indicates that the company is paying less than its income, which is sustainable over the long term. This also reflects that CNQ is keeping funds for better investment opportunities. The company is likely to pay its next dividend of $1.70 per share in October.

Additionally, CNQ has been reducing its debt levels and strengthening its financial position. It reduced its long-term debt from $16.02 billion in 2020 to $13.74 billion in December 2024. The company repurchased its common stock worth $2.66 billion in 2024. Compared to other energy companies, CNQ’s shareholder yield remains impressive, making it a compelling choice for investors seeking a combination of income and capital appreciation while benefiting from disciplined capital allocation.

CNQ currently sports a Zacks Rank #1 (Strong Buy) and a Zacks Value Score of ‘B’, implying strong upside potential for the stock. You can see the complete list of today’s Zacks #1 Rank stocks here.

Bain Capital Specialty Finance is an externally managed specialty finance company that focuses on lending to middle-market companies. With a dividend yield of 11.59%, BCSF provides investors with a steady income stream. The company has increased its dividend payout four times in the past five years, reflecting an annualized dividend growth rate of 6.4%. The payout ratio of 83% indicates that the company is paying less than its income, which is sustainable over the long term. This also reflects that Bain Capital Specialty Finance is keeping some funds for better investment opportunities.

Bain Capital Specialty Finance focuses on reducing its leverage, which ensures long-term financial stability. BCSF has reduced its debt from $1.46 billion in 2020 to $1.39 billion in 2024.

Bain Capital Specialty Finance currently has a Zacks Rank #2 (Buy) and a Zacks Value Score of ‘B’, implying solid prospects for the stock.

CSX has a dividend yieldof approximately 1.57%, providing another option for income-seeking investors. The company has increased its dividend payout five times over the past five years, resulting in an annualized dividend growth rate of 8.9%. The payout ratio of 31% indicates that CSX is paying less than its income, which is sustainable over the long term. This also reflects that the company is keeping funds for better investment opportunities.

With a long history of rewarding shareholders, CSX’s strong capital allocation strategy makes it a standout option for those looking for sustainable income and growth potential. In 2024, the company repurchased shares worth $2.2 billion and paid a dividend of $930 million. The company repurchased $3.7 billion worth of common stock in fiscal 2024. The company had $2.6 billion in total repurchase authority remaining as of Dec. 31, 2024

CSX currently carries a Zacks Rank of 2 and a Zacks Value Score of ‘D’, implying moderate prospects for the stock.

Verizon Communications, which offers communication services including local phone service, long-distance calls, wireless, and data services, boasts an impressive shareholder yield due to its robust dividend policy and stock repurchase initiatives. The company offers a dividend yield of around 6.28%. VZ has increased its dividend payout six times in the past five years, reflecting an annualized dividend growth rate of almost 2%. The payout ratio of 58% indicates that the company is paying less than its income, which is sustainable over the long term. This also reflects that VZ is keeping funds for better investment opportunities.

Additionally, it maintains a solid balance sheet with manageable debt levels, ensuring financial stability. The firm reduced its long-term debt from $123.17 billion in 2020 to $121.38 billion in December 2024. The total authorization for repurchase of the company’s common stock, as of Dec. 31, 2024, was $100 million.

VZ currently carries a Zacks Rank #2 and a Zacks Value Score of ‘A’, implying robust prospects for the stock.