Are You Looking for a High-Growth Dividend Stock?

Getting big returns from financial portfolios, whether through stocks, bonds, ETFs, other securities, or a combination of all, is an investor's dream. But 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.

Headquartered in Sandusky, Civista Bancshares (CIVB) is a Finance stock that has seen a price change of 24.21% so far this year. The bank holding company is paying out a dividend of $0.18 per share at the moment, with a dividend yield of 2.61% compared to the Banks - Midwest industry's yield of 2.36% and the S&P 500's yield of 1.35%.

Looking at dividend growth, the company's current annualized dividend of $0.72 is up 5.9% from last year. Over the last 5 years, Civista Bancshares has increased its dividend 5 times on a year-over-year basis for an average annual increase of 8.85%. 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. Civista Bancshares's current payout ratio is 25%, meaning it paid out 25% of its trailing 12-month EPS as dividend.

Looking at this fiscal year, CIVB expects solid earnings growth. The Zacks Consensus Estimate for 2026 is $2.83 per share, representing a year-over-year earnings growth rate of 1.43%.

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.

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. During periods of rising interest rates, income investors must be mindful that high-yielding stocks tend to struggle. With that in mind, CIVB 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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This article originally published on Zacks Investment Research (zacks.com).

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