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 account for significant portions of long-term returns, with dividend contributions exceeding one-third of total returns in many cases.

Based in Clayton, Enterprise Financial Services (EFSC Quick QuoteEFSC - Free Report) is in the Finance sector, and so far this year, shares have seen a price change of 5.24%. The financial holding company is currently shelling out a dividend of $0.32 per share, with a dividend yield of 2.25%. This compares to the Banks - Midwest industry's yield of 2.78% and the S&P 500's yield of 1.37%.

Looking at dividend growth, the company's current annualized dividend of $1.28 is up 4.9% from last year. Over the last 5 years, Enterprise Financial Services has increased its dividend 4 times on a year-over-year basis for an average annual increase of 11.88%. 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. Enterprise Financial Services's current payout ratio is 24%, meaning it paid out 24% of its trailing 12-month EPS as dividend.

EFSC is expecting earnings to expand this fiscal year as well. The Zacks Consensus Estimate for 2026 is $5.56 per share, which represents a year-over-year growth rate of 6.11%.

Investors like dividends for many reasons; they greatly improve stock investing profits, decrease overall portfolio risk, and carry tax advantages, among others. 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 have to be mindful of the fact that high-yielding stocks tend to struggle during periods of rising interest rates. With that in mind, EFSC is a compelling investment opportunity. Not only is it a strong dividend play, but the stock currently sits at a Zacks Rank of #3 (Hold).