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.

While cash flow can come from bond interest or interest from other types of investments, income investors hone in on 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.

First United Corporation (FUNC Quick QuoteFUNC - Free Report) is headquartered in Oakland, and is in the Finance sector. The stock has seen a price change of 10.44% since the start of the year. The company is currently shelling out a dividend of $0.26 per share, with a dividend yield of 2.52%. This compares to the Banks - Northeast industry's yield of 2.23% and the S&P 500's yield of 1.4%.

Looking at dividend growth, the company's current annualized dividend of $1.04 is up 13% from last year. Over the last 5 years, First United Corporation has increased its dividend 3 times on a year-over-year basis for an average annual increase of 13.06%. 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 United's current payout ratio is 25%, meaning it paid out 25% of its trailing 12-month EPS as dividend.

Earnings growth looks solid for FUNC for this fiscal year. The Zacks Consensus Estimate for 2026 is $4.40 per share, representing a year-over-year earnings growth rate of 10.83%.

Investors like dividends for many reasons; they greatly improve stock investing profits, decrease overall portfolio risk, and carry tax advantages, among others. But, not every company offers a quarterly payout.

Big, established firms that have more secure profits are often seen as the best dividend options, but it's fairly uncommon to see high-growth businesses or tech start-ups offer their stockholders a dividend. Income investors have to be mindful of the fact that high-yielding stocks tend to struggle during periods of rising interest rates. That said, they can take comfort from the fact that FUNC is not only an attractive dividend play, but also represents a compelling investment opportunity with a Zacks Rank of #2 (Buy).