Why DTE Energy (DTE) 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. But for income investors, generating consistent cash flow from each of your liquid investments is your primary focus.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 account for significant portions of long-term returns, with dividend contributions exceeding one-third of total returns in many cases.DTE Energy in FocusDTE Energy (DTE) is headquartered in Detroit, and is in the Utilities sector. The stock has seen a price change of 14.61% since the start of the year. The utility is paying out a dividend of $1.09 per share at the moment, with a dividend yield of 3.15% compared to the Utility - Electric Power industry's yield of 3.14% and the S&P 500's yield of 1.53%.In terms of dividend growth, the company's current annualized dividend of $4.36 is up 5.1% from last year. Over the last 5 years, DTE Energy has increased its dividend 4 times on a year-over-year basis for an average annual increase of 1.01%. 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. DTE Energy's current payout ratio is 60%, meaning it paid out 60% of its trailing 12-month EPS as dividend.Earnings growth looks solid for DTE for this fiscal year. The Zacks Consensus Estimate for 2025 is $7.24 per share, which represents a year-over-year growth rate of 6%.Bottom LineInvestors like dividends for many reasons; they greatly improve stock investing profits, decrease overall portfolio risk, and carry tax advantages, among others. However, not all companies offer 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. During periods of rising interest rates, income investors must be mindful that high-yielding stocks tend to struggle. That said, they can take comfort from the fact that DTE is not only an attractive dividend play, but is also a compelling investment opportunity with a 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 DTE Energy Company (DTE): 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