The Dow Jones Industrial Average has been the standard for blue chip stocks for decades, and while it's lost some sway in the market, the components are still some of the best businesses in the world. 

As we search for blue chips that still have growth ahead, one Dow Jones Industrial Average stock sticks out to me. Apple (AAPL 0.44%) generates more cash than it knows what to do with, and it has the potential to pay a higher dividend for the foreseeable future. 

Apple's earnings machine

You can see below just how big Apple's business has become. The company generated over $100 billion in free cash flow over the last year and there's no indication that's going to slow down anytime soon

AAPL Revenue (TTM) Chart

AAPL Revenue (TTM) data by YCharts

Apple has arguably the best product of all time in the iPhone, a growing services business, and improving personal computers and accessories. The combination is an extremely sticky set of products for users. 

Apple's fortress balance sheet

Apple's business is strong and it could pay a huge dividend, but before we talk about what it could pay out, we need to look at the balance sheet. You can see below that the company has a large amount of debt, primarily because of earnings overseas that it would need to pay taxes on to bring to the U.S., but it still has about $60 billion in net cash. 

AAPL Cash and Short Term Investments (Quarterly) Chart

AAPL Cash and Short Term Investments (Quarterly) data by YCharts

From this balance sheet strength, Apple could pay out a majority of its cash generated as a dividend and maintain a fortress balance sheet. But it only pays about 15% of earnings as a dividend, as you can see from the payout ration below. 

AAPL Dividends Paid (TTM) Chart

AAPL Dividends Paid (TTM) data by YCharts

Instead of paying a dividend, Apple buys back shares with most of its cash. This has the benefit of reducing shares outstanding, which increases earnings per share even if earnings themselves don't grow. 

Apple's dividend potential

If you want a growing dividend stock, you need a company that's growing free cash flow and/or has room to grow the dividend within existing cash flow. Apple has both. 

Apple could increase its dividend from a 0.7% yield today to over 3% and still not have a payout ratio of 100%. It could also continue to grow free cash flow at a steady rate and there would be a growing amount of excess cash for shareholders because of continued buybacks. 

I think we will look back on Apple as an incredible dividend stock a decade from now because it has a business that generates an incredible amount of cash. That's the foundation from which dividends are built, and this small dividend yield could be a big dividend yield with a few years of dividend growth.