Some investors think they have to choose between high-growth technology investments and slow-and-steady dividend payers. High-dividend tech stocks are the best of both worlds, offering the chance for impressive expansion in revenue and profits while also bringing you a steady payday every quarter. If you're looking for high-dividend tech stocks – either for the income potential or for the hope of share appreciation – all of these technology companies offer dividends around 3% or more (compared with around 2% on average for the S&P 500 (.SPX)) as well as consistent growth potential. Here are seven tech stocks to consider.
Israel-based Camtek (CAMT) is unique among tech dividend stocks in that it focuses on inspection equipment for memory chips, microprocessors and other similar items. If you've ever seen pictures of a semiconductor factory, then you've likely seen folks in what look like spacesuits – a precaution to keep dust and other particles out of these intricate products. Camtek is the last line of defense for high-tech manufacturers looking to protect the quality of their goods. That means reliable revenue – and reliable dividends – as CAMT has built long-term relationships with partners who need its 3D sensors and quality control gear.
Current yield: 5.3%
One of the most established dividend stocks among the tech giants of Wall Street, Cisco (CSCO) paid its first dividend of 6 cents a share back in 2011 and now pays six times that at a generous 36 cents quarterly. The enterprise technology giant has pivoted away from the hardware that it sold to dominate in the early 2000s to cloud computing solutions, too – meaning the company is intent on staying relevant and paying dividends for the long haul. Cisco's quarterly earnings back in May topped both sales and profit forecasts, and its forward guidance also beat expectations. That hints that recent challenges aren't holding back this tech dividend stock.
Current yield: 3.1%
Cogent Communications Holdings
Internet access and data services provider Cogent (CCOI) is a hybrid between a tech stock and a traditional telecom, focused on private network services for law firms, office buildings and single-tenant corporate centers. Its network of more than 50 data centers is tailor-made to serve "bandwidth-intensive" organizations. The digital toolbox of Cogent has become more important than ever as firms have been forced into more telecommuting and video conferencing due to the pandemic. However, the long-term growth of data and digital access will continue far longer than the current health crisis – powering CCOI to grow for years to come.
Current yield: 3.6%
Older investors may associate Corning (GLW) with industrial manufacturing. While that was indeed true, the roughly 170-year-old company is now making a name for itself with products like Gorilla Glass – a patented surface used in smartphones and tablets. The high-tech display material is designed to be durable but also to sense touch commands. While GLW's specialty glass and related products are an admittedly specialized piece of the consumer technology market, their widespread use adds up to diversified revenue to support consistent dividends to shareholders. And with revenue set to expand 10% next year, there are signs this business will remain a thriving niche for some time.
Current yield: 3.7%
California-based Juniper (JNPR) didn't quite stand out like other startups of the late 1990s, but the company quickly made a name for itself by focusing on networking technology. Its Ethernet routers, data centers, security software and other wireless tech solutions are now the gold standard for firms looking to maintain a network without maintaining a clunky on-site server room. The firm is not resting on its laurels, however, as evidenced by a big 2019 acquisition of artificial intelligence firm Mist Systems for $400 million. This focus on the future should keep JNPR relevant and growing for many more years to come.
Current yield: 3.3%
Taiwan Semiconductor Manufacturing
Semiconductor foundry TSM (TSM) is not a household name like chipmakers Intel (INTC) or Qualcomm (QCOM). However, it's a giant at $260 billion in market value. Its business centers around building semiconductors designed using other firms' blueprints. This offers a much more reliable stream of income than its peers, which only produce proprietary technology based on their latest designs. The margins are a bit lower, but TSM is capable of scaling up faster when the market demands – as evidenced by its projected 20% revenue growth this fiscal year and 10% growth forecast for next year. And with a diversified array of customers, TSM is insulated from the risk of profits drying up if one or two chip models become obsolete.
Current yield: 5.4%
The flip side of TSM is Texas Instruments (TXN), a slightly smaller but still substantial semiconductor and electronics firm valued at about $117 billion. The company designs, manufactures and sells semiconductors for a wide array of uses including portable power supplies, visual displays and wireless controllers. In a digital age, its clients include not just other technology firms, but also automakers, industrial firms and appliance manufacturers. As one of the top 10 chipmakers worldwide – with deep roots that include the invention of the hand-held calculator in 1967 – Texas Instruments has the kind of pedigree long-term dividend investors should love. And with 12% revenue expansion predicted next year, it has the growth potential tech investors also seek.
Current yield: 2.9%
|For more news you can use to help guide your financial life, visit our Insights page.|