Why Colony Bankcorp (CBAN) is a Top Dividend Stock for Your Portfolio

Getting big returns from financial portfolios, whether through stocks, bonds, ETFs, other securities, or a combination of all, is an investor's dream. 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.Colony Bankcorp in FocusColony Bankcorp (CBAN) is headquartered in Fitzgerald, and is in the Finance sector. The stock has seen a price change of -2.91% since the start of the year. The bank holding company is currently shelling out a dividend of $0.12 per share, with a dividend yield of 2.94%. This compares to the Banks - Southeast industry's yield of 2.33% and the S&P 500's yield of 1.62%.Taking a look at the company's dividend growth, its current annualized dividend of $0.46 is up 2.2% from last year. Over the last 5 years, Colony Bankcorp has increased its dividend 5 times on a year-over-year basis for an average annual increase of 2.99%. Any future dividend growth will depend on both earnings growth and the company's payout ratio; a payout ratio is the proportion of a firm's annual earnings per share that it pays out as a dividend. Colony Bankcorp's current payout ratio is 31%, meaning it paid out 31% of its trailing 12-month EPS as dividend.Earnings growth looks solid for CBAN for this fiscal year. The Zacks Consensus Estimate for 2025 is $1.71 per share, which represents a year-over-year growth rate of 17.12%.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.For instance, it's a rare occurrence when a tech start-up or big growth business offers their 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. With that in mind, CBAN presents a compelling investment opportunity; it's not only an attractive dividend play, but the stock also boasts a strong Zacks Rank of #1 (Strong Buy).5 Stocks Set to DoubleEach was handpicked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2024. While not all picks can be winners, previous recommendations have soared +143.0%, +175.9%, +498.3% and +673.0%.Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.Today, See These 5 Potential Home Runs >>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 Colony Bankcorp, Inc. (CBAN): 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