Why Chesapeake Utilities (CPK) is a Top Dividend Stock for Your Portfolio

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.Chesapeake Utilities in FocusBased in Dover, Chesapeake Utilities (CPK) is in the Utilities sector, and so far this year, shares have seen a price change of 4.86%. The energy and utility company is paying out a dividend of $0.64 per share at the moment, with a dividend yield of 2.01% compared to the Utility - Gas Distribution industry's yield of 3.42% and the S&P 500's yield of 1.57%.In terms of dividend growth, the company's current annualized dividend of $2.56 is up 2% from last year. Chesapeake Utilities has increased its dividend 5 times on a year-over-year basis over the last 5 years for an average annual increase of 10.07%. 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. Chesapeake Utilities's current payout ratio is 47%. This means it paid out 47% of its trailing 12-month EPS as dividend.Looking at this fiscal year, CPK expects solid earnings growth. The Zacks Consensus Estimate for 2025 is $6.26 per share, which represents a year-over-year growth rate of 16.14%.Bottom LineInvestors like dividends for many reasons; they greatly improve stock investing profits, decrease overall portfolio risk, and carry tax advantages, among others. 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. Income investors have to be mindful of the fact that high-yielding stocks tend to struggle during periods of rising interest rates. With that in mind, CPK 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).Zacks Names #1 Semiconductor StockIt's only 1/9,000th the size of NVIDIA which skyrocketed more than +800% since we recommended it. NVIDIA is still strong, but our new top chip stock has much more room to boom.With strong earnings growth and an expanding customer base, it's positioned to feed the rampant demand for Artificial Intelligence, Machine Learning, and Internet of Things. Global semiconductor manufacturing is projected to explode from $452 billion in 2021 to $803 billion by 2028.See This Stock Now for Free >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Chesapeake Utilities Corporation (CPK): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks