Tech Stock Dividends: It's an actual thing now

In the past, investors have looked at tech stocks that initiate dividends suspiciously, the thought process being “what’s wrong with this company that they have no ideas to use this capital for growth?”

And typically, there’s been a punitive effect on dividend payers in techland in the form of PE multiple compression – again, the question was “why would anyone want a value tech stock when there’s so much potential growth elsewhere in the sector?”

But this has changed over the years, Microsoft is yielding 2.7% these days and Intel is paying over 3% to shareholders – this is part admission that both businesses are mature and part shareholder-friendliness.  And over the last decade, the shareholder bases of these companies has changed over from growth/momentum investors to value guys.  The circle of life.

Moodys looks at the relatively new phenomenon of technology stock dividends in a new report (via MarketWatch):

Dividend payments by technology companies are expected to rise 14% in 2012 from a year earlier, despite the ongoing fragile recovery, according to a recent Moody’s Investors Service report.

Dividend payments are expected to approach $26 billion in 2012, Moody’s said…

Companies that have recently shifted their stances on the issue include consumer-electronics giant Apple Inc., which in March unveiled plans for its first-ever dividend, and Marvell Technology Group, which makes chips for hard-disk drives and mobile devices, announced its first payout last month.

Moody’s noted Apple will dwarf previous payouts, with a run rate dividend of nearly $10 billion expected this year, surpassing Exxon Mobil Corp.’s estimated $9 billion dividend and just behind AT&T Inc.’s $10.2 billion dividend.

The analysts note that tech dividends will still lag far behind other industry groups in the aggregate and that there will still be holdouts like Google and eBay.  But the world of dividend investing has gotten a bit broader and the potential for dividend growth in the XLK names is a pretty exciting thing to think about.

Source:

Tech Dividends to Rise 14% This Year (MarketWatch)

Tags: , , , , ,

This content, which contains security-related opinions and/or information, is provided for informational purposes only and should not be relied upon in any manner as professional advice, or an endorsement of any practices, products or services. There can be no guarantees or assurances that the views expressed here will be applicable for any particular facts or circumstances, and should not be relied upon in any manner. You should consult your own advisers as to legal, business, tax, and other related matters concerning any investment.

The commentary in this “post” (including any related blog, podcasts, videos, and social media) reflects the personal opinions, viewpoints, and analyses of the Ritholtz Wealth Management employees providing such comments, and should not be regarded the views of Ritholtz Wealth Management LLC. or its respective affiliates or as a description of advisory services provided by Ritholtz Wealth Management or performance returns of any Ritholtz Wealth Management Investments client.

References to any securities or digital assets, or performance data, are for illustrative purposes only and do not constitute an investment recommendation or offer to provide investment advisory services. Charts and graphs provided within are for informational purposes solely and should not be relied upon when making any investment decision. Past performance is not indicative of future results. The content speaks only as of the date indicated. Any projections, estimates, forecasts, targets, prospects, and/or opinions expressed in these materials are subject to change without notice and may differ or be contrary to opinions expressed by others.

Wealthcast Media, an affiliate of Ritholtz Wealth Management, receives payment from various entities for advertisements in affiliated podcasts, blogs and emails. Inclusion of such advertisements does not constitute or imply endorsement, sponsorship or recommendation thereof, or any affiliation therewith, by the Content Creator or by Ritholtz Wealth Management or any of its employees. Investments in securities involve the risk of loss. For additional advertisement disclaimers see here: https://www.ritholtzwealth.com/advertising-disclaimers

Please see disclosures here.

What's been said:

Discussions found on the web
  1. Bitcoin Loophole Review commented on Sep 22

    … [Trackback]

    […] Information on that Topic: thereformedbroker.com/2012/06/14/tech-stock-dividends-its-an-actual-thing-now/ […]

  2. Bitcoin Loophole Review commented on Sep 23

    … [Trackback]

    […] Read More Information here on that Topic: thereformedbroker.com/2012/06/14/tech-stock-dividends-its-an-actual-thing-now/ […]

  3. Where To Buy Weed Online commented on Sep 23

    … [Trackback]

    […] There you can find 94681 more Info on that Topic: thereformedbroker.com/2012/06/14/tech-stock-dividends-its-an-actual-thing-now/ […]

  4. 918kiss commented on Sep 28

    … [Trackback]

    […] Here you will find 65350 additional Information on that Topic: thereformedbroker.com/2012/06/14/tech-stock-dividends-its-an-actual-thing-now/ […]

  5. bitcoin loophole review commented on Sep 29

    … [Trackback]

    […] Find More to that Topic: thereformedbroker.com/2012/06/14/tech-stock-dividends-its-an-actual-thing-now/ […]

  6. immediate edge reviews commented on Oct 01

    … [Trackback]

    […] Here you will find 33378 additional Info on that Topic: thereformedbroker.com/2012/06/14/tech-stock-dividends-its-an-actual-thing-now/ […]

  7. 스포츠토토 commented on Oct 06

    … [Trackback]

    […] Read More Information here to that Topic: thereformedbroker.com/2012/06/14/tech-stock-dividends-its-an-actual-thing-now/ […]

  8. Digital Transformation Consultants commented on Nov 18

    … [Trackback]

    […] Info on that Topic: thereformedbroker.com/2012/06/14/tech-stock-dividends-its-an-actual-thing-now/ […]

  9. td login commented on Dec 13

    … [Trackback]

    […] Read More to that Topic: thereformedbroker.com/2012/06/14/tech-stock-dividends-its-an-actual-thing-now/ […]

  10. td trust easyweb commented on Dec 16

    … [Trackback]

    […] Read More on that Topic: thereformedbroker.com/2012/06/14/tech-stock-dividends-its-an-actual-thing-now/ […]

  11. sbobetonline commented on Jan 06

    … [Trackback]

    […] Information on that Topic: thereformedbroker.com/2012/06/14/tech-stock-dividends-its-an-actual-thing-now/ […]

  12. tangerine login commented on Jan 10

    … [Trackback]

    […] Find More on that Topic: thereformedbroker.com/2012/06/14/tech-stock-dividends-its-an-actual-thing-now/ […]

  13. https://www.replikklockor.com/ commented on Jan 14

    … [Trackback]

    […] Here you will find 13146 additional Information on that Topic: thereformedbroker.com/2012/06/14/tech-stock-dividends-its-an-actual-thing-now/ […]