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 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 make up large portions of long-term returns, and in many cases, dividend contributions surpass one-third of total returns.

Headquartered in Tulsa, ONE Gas (OGS Quick QuoteOGS - Free Report) is a Utilities stock that has seen a price change of -7.06% so far this year. Currently paying a dividend of $0.68 per share, the company has a dividend yield of 3.79%. In comparison, the Utility - Gas Distribution industry's yield is 3.34%, while the S&P 500's yield is 1.42%.

Looking at dividend growth, the company's current annualized dividend of $2.72 is up 1.5% from last year. Over the last 5 years, ONE Gas has increased its dividend 5 times on a year-over-year basis for an average annual increase of 4.53%. 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. ONE Gas's current payout ratio is 56%, meaning it paid out 56% of its trailing 12-month EPS as dividend.

Earnings growth looks solid for OGS for this fiscal year. The Zacks Consensus Estimate for 2026 is $4.92 per share, which represents a year-over-year growth rate of 9.82%.

Investors like dividends for a variety of different reasons, from tax advantages and decreasing overall portfolio risk to considerably improving stock investing profits. It's important to keep in mind that not all companies provide 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. That said, they can take comfort from the fact that OGS is not only an attractive dividend play, but is also a compelling investment opportunity with a Zacks Rank of #2 (Buy).