3 Big Technology Stocks With Big Dividend Potential

Technology stocks' yields aren't much to look at, but these three firms have deep financial resources to keep the pedal down on dividend growth.

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The Federal Reserve has stated that it will keep printing money until it has achieved its dual mandate of full employment and 2% inflation.

It's nowhere near achieving either of those targets, so the Fed's benchmark interest rate will continue to stay low – Fed Chair Jerome Powell indicated recently that timeline could be at least three years. That's great news for the equity markets overall, but bad news for investors looking for yield because income from bonds could be low for a long time.

Investors can seek out yield in equity, but they face difficulties there, too. The S&P 500 yields a low 1.7%. And it's far less than that in certain sectors, such as technology stocks, which on average yield less than 1%.

But baseline yield isn't the only thing that matters in dividend investing.

Dividend payers that grow their payouts rapidly over time produce a higher "yield on cost." Investors considering these dividend growers should also make sure they have low dividend payout ratios (the percentage of profits that go toward funding dividends). That means they'll likely have the resources to continue boosting their cash distributions over time.

The tech sector has dividend raisers in spades. So, those looking to the sector for continued growth will also find sources of swelling dividends. Read on as we look at three technology stocks that fit right in with an income investor's portfolio.


Data is as of Dec. 10. Stocks listed in reverse order of yield. Dividend yields are calculated by annualizing the most recent payout and dividing by the share price.

Rob Morgan
Contributing Writer, Kiplinger.com