Why ICL Group (ICL) is a Top Dividend Stock for Your Portfolio

All investors love getting big returns from their portfolio, whether it's through stocks, bonds, ETFs, or other types of securities. 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.

ICL Group (ICL) is headquartered in Tel Aviv, and is in the Basic Materials sector. The stock has seen a price change of 2.28% since the start of the year. The potash and fertilizer producer is paying out a dividend of $0.04 per share at the moment, with a dividend yield of 2.99% compared to the Fertilizers industry's yield of 2.99% and the S&P 500's yield of 1.37%.

Looking at dividend growth, the company's current annualized dividend of $0.17 is up 4.9% from last year. Over the last 5 years, ICL Group has increased its dividend 2 times on a year-over-year basis for an average annual increase of 6.59%. 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. ICL Group's current payout ratio is 38%, meaning it paid out 38% of its trailing 12-month EPS as dividend.

ICL is expecting earnings to expand this fiscal year as well. The Zacks Consensus Estimate for 2026 is $0.44 per share, which represents a year-over-year growth rate of 22.22%.

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.

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 must be conscious of the fact that high-yielding stocks tend to struggle during periods of rising interest rates. With that in mind, ICL presents a compelling investment opportunity; it's not only an attractive dividend play, but the stock also boasts a strong Zacks Rank of #2 (Buy).

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This article originally published on Zacks Investment Research (zacks.com).

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