Best of the Week
Most Popular
1.Are UK Savings Interest Rates Finally Starting to Rise? Best Cash ISA 2017 - Nadeem_Walayat
2.Inflation Tsunami - Supermarkets, Retail Sector Crisis 2017, EU Suicide and Burning Stocks - Nadeem_Walayat
3.Big Moves in the World Stock Markets - Big Bases - Rambus_Chartology
4.The Next Financial Implosion Is Not Going To Be About The Banks! - Gordon_T_Long
5.Why EU BrExit Single Market Access Hard line is European Union Committing Suicide - Nadeem_Walayat
6.Trump Ramps Up US Military Debt Spending In Preparations for China War - Nadeem_Walayat
7.Watch What Happens When Silver Price Hits $26...  - MoneyMetals
8.Stock Market Fake Risk, Fake Return? Market Crash? - 2nd Mar 17 - Axel_Merk
9.Global Inflation Surges, Central Banks Losing Control and Triggered the Wage Price Spiral? - Nadeem_Walayat
10.Why Gold Will Boom In 2017 - James Burgess
Last 7 days
London Terror Attack Red Herring, Real Issue is Age of Reason vs Religion - 25th Mar 17
Will Washington Risk WW3 to Block an Emerging EU-Russia Superstate - 25th Mar 17
Unaccountable Military Industrial Complex Is Destroying America and the Rest Of The World Too - 25th Mar 17
Silver Mining Stock Fundamentals - 24th Mar 17
A Walk Down the Dark Road of Bad Government - 24th Mar 17
Is Stock Market Flash Crash Postponed Until Monday? - 24th Mar 17
Stock Market Bubble and Gold - 24th Mar 17
Maps Of Past Empires That Can Tell Us About The Future - 24th Mar 17
SNP Independent Scotland's Destiny With Economic Catastrophe, the English Subsidy - IndyRef2 - 24th Mar 17
Stock Market VIX Cycles Set To Explode March/April 2017 – Part II - 23rd Mar 17
Is Now a Good Time to Invest in the US Housing Market? - 23rd Mar 17
The Stock Market Is a Present-Day Version of Pavlov’s Dog - 23rd Mar 17
US Budget - There’s Almost Nothing Left To Cut - 23rd Mar 17
Stock Market Upward Reversal Or Just Quick Rebound Before Another Leg Down? - 23rd Mar 17
Trends to Look Out For as a Modern-day Landlord - 23rd Mar 17
Here’s Why Interstate Health Insurance Won’t Fix Obamacare / Trumpcare - 23rd Mar 17
China’s Biggest Limitations Determine the Future of East Asia - 23rd Mar 17
This is About So Much More Than Trump and Brexit - 23rd Mar 17
Trump Stock Market Rally Over? 20% Bear Drop By Mid Summer? - 22nd Mar 17
Trump Added $3 Trillion in Wealth to Stock Market Participants - 22nd Mar 17
What's Next for the US Dollar, Gold and Stocks? - 22nd Mar 17
MSM Bond Market Full Nonsense Mode as ‘Trump Trades’ Unwind on Schedule - 22nd Mar 17
Peak Gold – Biggest Gold Story Not Being Reported - 22nd Mar 17
Return of Sovereign France, Europe’s Changing Landscape - 22nd Mar 17
Trump Stocks Bull Market Rolling Over? You Were Warned! - 22nd Mar 17
Stock Market Charts That Scream “This Is It” - Here’s What to Do - 22nd Mar 17
Raising the Minimum Wage Is a Jobs Killing Move - 22nd Mar 17
Potential Bottoming Patterns in Gold and Silver Precious Metals Stocks Complex... - 22nd Mar 17
UK Stagflation, Soaring Inflation CPI 2.3%, RPI 3.2%, Real 4.4% - 21st Mar 17
The Demise of the Gold and Silver Bull Run is Greatly Exaggerated - 21st Mar 17
USD Decline Continues, Pull SPX Down as well? - 21st Mar 17
Trump Watershed Budget - 21st Mar 17
How do Client Acquisition Offers Affect Businesses? - 21st Mar 17
Physical Metals Demand Plus Manipulation Suits Will Break Paper Market - 20th Mar 17
Stock Market Uncertainty Following Interest Rate Increase - Will Uptrend Continue? - 20th Mar 17
Precious Metals : Who’s in Charge ? - 20th Mar 17
Stock Market Correction Continues - 20th Mar 17
Why The Status Quo Is Under Increasing Attack By 'Populist People Power' - 20th Mar 17
Why the SNP WILL Destroy Scotland, Exit UK Single Market for EU - IndyRef2 - 19th Mar 17
Crypto Craziness: Bitcoin Plunges on Fork Concerns, Steem Skyrockets and Dash Surges Above $100 - 19th Mar 17
What ‘Ice-Nine’ Means for Your Money - 19th Mar 17
Stock Market 4 Year Cycle - 18th Mar 17
The Only Article You Need to Read to Understand the Trump Phenomenon - 17th Mar 17
Janet Yellen Just Popped the Stock Market Bubble - 17th Mar 17
Financial Crisis, Steve Eisman: Smart, Lucky, Abrasive & Now One Of Them - 17th Mar 17
Gold Cup – Horse Racing’s Greatest Show, Gambling and ‘Going for Gold’ - 17th Mar 17
Trader Education Week - Free Event to Help You Learn to Spot Trading Opportunities - 17th Mar 17
$1.4 Trillion of SPX Notionals Due to Expire - 17th Mar 17
Preserving Order Amid Change in NAFTA, U.S. Sovereignty v. WTO - 17th Mar 17
3 Maps That Explain Why Syria Raqqa Battle Will Drag On - 17th Mar 17

Market Oracle FREE Newsletter

Elliott Wave Trading

Five High-Yield Dividend Stocks That Will Make You Love the Tech Sector

Companies / Tech Stocks Jun 19, 2014 - 12:09 PM GMT

By: Money_Morning

Companies

Tara Clarke writes: Investors looking for high-yield dividend stocks have previously eschewed the tech sector, as that's traditionally been a place to invest for growth.

Instead of paying out extra cash to investors, tech high-fliers typically reinvest cash in research and development, mergers and acquisitions, and other classic "growth" strategies. That's why their earnings - and share prices - grow faster than average.


3D Systems Corp. (NYSE: DDD) is the perfect example. Money Morning Defense & Tech Specialist Michael A. Robinson recently called it "the ultimate growth stock."

3D Systems started an aggressive acquisitions program in 2007 to gain engineers, software, and other material needs. DDD has acquired more than 40 companies since 2011. It has also more than tripled its R&D spending per quarter since 2012 - compare $4.933 million spent in Q1 2012 to $17.24 million spent in Q1 2014.

The company's earnings reflect the payoff - on February 28, DDD announced full-year revenue growth of 45% for 2013 to a record-high $513.4 million. And 3D Systems stock has skyrocketed - DDD gained more than 850% in two years, jumping from around $10 per share at the start of 2012 to $96 per share at the end of 2013.

But, like a classic searing-hot tech stock, DDD has never paid a dividend.

That's why investors looking for high-yield dividend stocks go to sectors like utilities and consumer staples.

These companies have matured. Their growth phases are over, so they use their strong cash flows to pay dividends. This attracts investors even if the stock has low share-price growth.

Procter & Gamble (NYSE: PG), for example, has increased its dividend for 57 straight years and offers a yield of 3.23%.

But a few years ago, things started to change. Now companies like this also exist in the tech sector.

In fact, some of the biggest names in tech have become high-yield dividend stocks that rival traditional dividend payers in yield and market performance.

And investors who take advantage of this trend will tap into some of the biggest dividend payouts in history...

Tech Becomes the Home of High Yield

As tech companies mature and transition from their growth phase into a more stable period, they usually find themselves with more cash than they know what to do with. That's why a couple of years ago, tech dividend payouts picked up the pace. They jumped about 14% in 2012 - compared to the previous years' increases of about 10%.

According to the online investing resource Investopedia, over the past 10 years tech has increased its average dividend payments by 25%. That's about 10% higher than the second-biggest dividend payer, consumer services.

Now Apple Inc. (Nasdaq: AAPL) is the largest dividend payer in the Standard & Poor's 500 Index. It paid out more than $10 billion in dividends in 2013.

Another reason to turn to tech for yield is, not only do these dividend payers provide income, but they also have outperformed market downturns. Many have shown sustained growth even in volatile markets.

For instance, the Nasdaq Composite plummeted 8.22% between March 5 and April 11 this year. In the same time period, tech giant Microsoft Corp. (Nasdaq: MSFT) - which pays a quarterly dividend of $0.28 per share - gained 2.08%.
high yield dividend stocks

Now, here's a look at five high-yield dividend stocks in the tech sector.

Five High-Yield Dividend Stocks in the Technology Sector

Intel Corp. (Nasdaq: INTC)

U.S. chip manufacturer Intel doubled its dividend from 2007 to 2012, now paying $0.225 on a quarterly basis, or $0.90 annually. That's good for a yield of 3%. And, with a price that's only 11 times next year's earnings, it could still see significant growth in the next year. Plus, those who are assembling an income portfolio will be pleased to know that Intel has increased its dividend every year for the past decade.

INTC is up 15.45% year to date, and 20.24% over the last 12 months. Shares traded at $29.97 on Monday.

Apple Inc. (Nasdaq: AAPL)

The world's second-largest IT company by revenue, Apple started offering a dividend in 2012 after a 17-year hiatus. But, according to FactSet dividend information, it has quickly climbed to become the second-largest payer of dividends in the S&P 500, second only to Exxon Mobil Corp. (NYSE: XOM). Apple investors were rewarded with a $3.29 dividend on May 8, good for a yield of 2.04%.

Last Monday, an Apple stock split sent shares from more than $600 per share to a little over $90 per share. Apple stock traded at $92.26 on Monday and is up 15.08% year to date.

Cisco Systems Inc. (Nasdaq: CSCO)
high yield dividend stocks

In mid-December, networking equipment master Cisco Systems increased its dividend after a phone call from consumer advocate Ralph Nader. Nader urged the company, which had $45 billion in liquid assets, to share the wealth with their investors. Cisco obliged, boosting its dividend from $0.17 per quarter to $0.19 per quarter for an annual dividend of $0.76. That's good for a 3.1% yield.

CSCO stock is up 18.57% over the last six months, and 9.32% year to date. Shares traded at $24.52 on Monday.

Microsoft Corp. (Nasdaq: MSFT)

The world's largest software maker by revenue, Microsoft is stable and cash-rich, with over $77 billion on its books. However, that has not stopped the company from increasing its dividend every year for more than 12 years. TCW Dividend-Focused Fund portfolio manager Diane Jaffee told CNBC in March that she believes "there's still lots of room for dividend growth" for MSFT.

Microsoft currently pays a quarterly dividend of $0.28, for a yield of 2.71%. MSFT stock is up 11.15% year to date and traded at $41.55 per share on Monday.

Microchip Technology Inc. (Nasdaq: MCHP)

Arizona-based semiconductor manufacturer Microchip Technology's stock is another that has shown sustained increase in dividends over a long stretch of time. According to a January announcement from the company, since introducing a dividend in 2003, MCHP has increased its dividend 40 times.

January's announcement pushed this high-yield dividend stock to a record-breaking $0.3555 quarterly dividend, good for a yield of 2.91%. Microchip President, Chief Executive Officer, and Chairman Steve Sanghi credited the increase to the company's sustained cash generation. MCHP traded at $48.83 per share on Monday and is up 9.12% in 2014.

Source : http://moneymorning.com/2014/06/16/five-high-yield-dividend-stocks-that-will-make-you-love-the-tech-sector/

Money Morning/The Money Map Report

©2014 Monument Street Publishing. All Rights Reserved. Protected by copyright laws of the United States and international treaties. Any reproduction, copying, or redistribution (electronic or otherwise, including on the world wide web), of content from this website, in whole or in part, is strictly prohibited without the express written permission of Monument Street Publishing. 105 West Monument Street, Baltimore MD 21201, Email: customerservice@moneymorning.com

Disclaimer: Nothing published by Money Morning should be considered personalized investment advice. Although our employees may answer your general customer service questions, they are not licensed under securities laws to address your particular investment situation. No communication by our employees to you should be deemed as personalized investent advice. We expressly forbid our writers from having a financial interest in any security recommended to our readers. All of our employees and agents must wait 24 hours after on-line publication, or after the mailing of printed-only publication prior to following an initial recommendation. Any investments recommended by Money Morning should be made only after consulting with your investment advisor and only after reviewing the prospectus or financial statements of the company.

Money Morning Archive

© 2005-2016 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in

Catching a Falling Financial Knife