We not too long ago revealed a listing of the 13 Greatest Know-how Dividend Shares to Spend money on. On this article, we’re going to check out the place QUALCOMM Integrated (NASDAQ:QCOM) stands towards different greatest expertise dividend shares.
There was a time when tech shares drew investor curiosity purely for his or her progress potential. However extra not too long ago, they’ve been gaining consideration for a unique purpose: dividends. This marks a serious shift, provided that tech firms have historically centered their sources on innovation and enlargement. At present, a good portion of the tech sector consists of established corporations with strong enterprise fashions, wholesome margins, regular progress, sturdy financials, and manageable debt ranges. Based on S&P, about 39% of tech firms within the Composite 1500 index are actually returning capital to shareholders via dividends—a notable soar from 28% again in 2013.
As well as, expertise shares have emerged as a serious contributor to the market’s general dividend payouts. FactSet information confirmed that tech firms now account for round 13% of the overall greenback worth of dividends throughout the S&P Composite Index. That places the tech sector simply behind financials, making it the second-largest supply of dividends within the index—with a robust likelihood of taking the highest spot within the close to future.
What’s extra shocking is that tech firms haven’t simply begun distributing dividends—they’ve additionally seen a choose group constantly elevate their payouts 12 months after 12 months. This group consists of among the world’s most distinguished and profitable names, alongside main international consulting corporations, bank card suppliers, and different tech-adjacent gamers. Over the previous a number of years, dividend progress from the expertise sector has outpaced that of the broader market. Knowledge from S&P Dow Jones Indices confirmed that tech firms throughout the S&P Composite greater than doubled their complete dividend payouts by 2023 in comparison with 2013. This progress ranks because the fourth highest amongst all sectors and considerably surpasses the Index’s general dividend improve of seven.2% throughout the identical timeframe. With tech’s present dividend payout ratio at simply 39%, there seems to be appreciable room for additional enlargement.
The transfer by main tech corporations to begin paying dividends has sparked discussions round discovering the correct steadiness between capital appreciation and earnings era. Sam Witherow, who manages the JPM International Fairness Revenue fund, famous that though his fund has historically included a mixture of dividend-paying firms and people centered on capital progress, the traits of a few of these firms are actually evolving. He made the next remark about these methods:
“We’re searching for to offer shoppers with each a yield premium to the market and a dividend progress premium to the market on the combination portfolio degree. It’s the mix of the 2 traits that sometimes results in the very best risk-adjusted returns. To ship this we have now all the time regarded to have diversified publicity throughout international industries together with historically growthier industries like shopper discretionary or tech.”
Sam Buckingham, an funding supervisor at Abrdn Portfolio Options, identified that progress shares providing smaller dividends may very well be helpful for earnings funds aiming to diversify throughout totally different sectors and funding elements. He defined that whereas these shares sometimes begin with decrease yields, they usually have the potential for dividend progress over time. When paired with extra conventional earnings shares—like these within the utilities sector that provide larger preliminary payouts however slower progress—they will help create a extra balanced portfolio. Given this, we’ll check out among the greatest dividend shares within the tech sector.
Is QUALCOMM Integrated (QCOM) the Greatest Know-how Dividend Inventory to Spend money on?
A technician testing the newest 5G gadget, demonstrating the corporate’s dedication to innovation.
For this listing, we scanned the holdings of the S&P Info Know-how index, which tracks the efficiency of main tech firms. From there, we recognized firms that pay dividends to shareholders and picked 13 firms with the very best variety of hedge fund traders, as per Insider Monkey’s This autumn 2024 database. The shares are ranked in line with the variety of hedge funds having stakes in them.
Why are we within the shares that hedge funds pile into? The reason being easy: our analysis has proven that we will outperform the market by imitating the highest inventory picks of the very best hedge funds. Our quarterly publication’s technique selects 14 small-cap and large-cap shares each quarter and has returned 373.4% since Could 2014, beating its benchmark by 218 proportion factors (see extra particulars right here).
Variety of Hedge Fund Holders: 79
QUALCOMM Integrated (NASDAQ:QCOM) is a California-based multinational semiconductor manufacturing firm that makes a speciality of wi-fi telecommunications expertise. The corporate is well-positioned to capitalize on the rise of AI and the rising demand for edge computing. Its alliances with main gamers like Samsung and Google have strengthened its presence throughout cellular and PC platforms.
Within the first quarter of fiscal 12 months 2025, QUALCOMM Integrated (NASDAQ:QCOM) delivered spectacular outcomes, posting $11.7 billion in income—up 17.6% from the identical interval the 12 months earlier than. This marked the third straight quarter of double-digit income progress and set a brand new quarterly file for the corporate. The chip section (QCT) was a serious contributor, bringing in $10.1 billion in income, a 20% improve year-over-year. Inside this division, smartphone chip gross sales climbed 13% to $7.6 billion, automotive income soared 61% to $961 million, and the Web of Issues (IoT) section expanded 36% to $1.5 billion.
QUALCOMM Integrated (NASDAQ:QCOM) additionally ended the quarter with a robust monetary place, holding over $3.1 billion in money and money equivalents. It generated almost $4.6 billion in working money movement and returned $942 million to shareholders via dividends. The corporate has raised its payouts for 21 consecutive years, coming via as probably the greatest dividend shares on our listing. With its quarterly dividend standing at $0.89 per share, QCOM presents a dividend yield of two.53%, as of April 10.
General, QCOM ranks seventh on our listing of the very best dividend shares within the tech sector. Whereas we acknowledge the potential of QCOM as an funding, our conviction lies within the perception that some deeply undervalued dividend shares maintain better promise for delivering larger returns, and doing so inside a shorter timeframe. If you’re on the lookout for a deeply undervalued dividend inventory that’s extra promising than QCOM however that trades at 10 instances its earnings and grows its earnings at double digit charges yearly, take a look at our report concerning the grime low cost dividend inventory.
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Disclosure: None. This text is initially revealed at Insider Monkey.
