All investors love getting big returns from their portfolio, whether it's through stocks, bonds, ETFs, or other types of securities. 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 make up large portions of long-term returns, and in many cases, dividend contributions surpass one-third of total returns.

Headquartered in Pine Bluff, Simmons First National (SFNC Quick QuoteSFNC - Free Report) is a Finance stock that has seen a price change of -12.71% so far this year. The bank holding company is paying out a dividend of $0.21 per share at the moment, with a dividend yield of 4.39% compared to the Banks - Southeast industry's yield of 2.28% and the S&P 500's yield of 1.49%.

Looking at dividend growth, the company's current annualized dividend of $0.85 is up 1.2% from last year. Over the last 5 years, Simmons First National has increased its dividend 5 times on a year-over-year basis for an average annual increase of 5.01%. 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. Simmons First National's current payout ratio is 58%, meaning it paid out 58% of its trailing 12-month EPS as dividend.

Looking at this fiscal year, SFNC expects solid earnings growth. The Zacks Consensus Estimate for 2025 is $1.72 per share, which represents a year-over-year growth rate of 21.99%.

From greatly improving stock investing profits and reducing overall portfolio risk to providing tax advantages, investors like dividends for a variety of different reasons. But, not every company offers a quarterly payout.

For instance, it's a rare occurrence when a tech start-up or big growth business offers its shareholders a dividend. It's more common to see larger companies with more established profits give out dividends. 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, SFNC 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).