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Whether it's through stocks, bonds, ETFs, or other types of securities, all investors love seeing their portfolios score big returns. However, 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 account for significant portions of long-term returns, with dividend contributions exceeding one-third of total returns in many cases.
Based in Hampton, Unitil (UTL - Free Report) is in the Utilities sector, and so far this year, shares have seen a price change of 7.6%. The utility is currently shelling out a dividend of $0.47 per share, with a dividend yield of 3.65%. This compares to the Utility - Electric Power industry's yield of 2.82% and the S&P 500's yield of 1.4%.
Looking at dividend growth, the company's current annualized dividend of $1.90 is up 5.6% from last year. Over the last 5 years, Unitil has increased its dividend 5 times on a year-over-year basis for an average annual increase of 3.84%. 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. Unitil's current payout ratio is 56%, meaning it paid out 56% of its trailing 12-month EPS as dividend.
UTL is expecting earnings to expand this fiscal year as well. The Zacks Consensus Estimate for 2026 is $3.31 per share, with earnings expected to increase 4.75% from the year ago period.
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. During periods of rising interest rates, income investors must be mindful that high-yielding stocks tend to struggle. With that in mind, UTL 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).
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Whether it's through stocks, bonds, ETFs, or other types of securities, all investors love seeing their portfolios score big returns. However, 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 account for significant portions of long-term returns, with dividend contributions exceeding one-third of total returns in many cases.
Based in Hampton, Unitil (UTL - Free Report) is in the Utilities sector, and so far this year, shares have seen a price change of 7.6%. The utility is currently shelling out a dividend of $0.47 per share, with a dividend yield of 3.65%. This compares to the Utility - Electric Power industry's yield of 2.82% and the S&P 500's yield of 1.4%.
Looking at dividend growth, the company's current annualized dividend of $1.90 is up 5.6% from last year. Over the last 5 years, Unitil has increased its dividend 5 times on a year-over-year basis for an average annual increase of 3.84%. 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. Unitil's current payout ratio is 56%, meaning it paid out 56% of its trailing 12-month EPS as dividend.
UTL is expecting earnings to expand this fiscal year as well. The Zacks Consensus Estimate for 2026 is $3.31 per share, with earnings expected to increase 4.75% from the year ago period.
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. During periods of rising interest rates, income investors must be mindful that high-yielding stocks tend to struggle. With that in mind, UTL 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).