Tech stocks have been red-hot in 2023, delivering outsized gains. They’ve jumped back in favor following a tough 2022, with expectations of a less-hawkish fed helping drive performances.
Other than tech stocks, investors also love dividends, as they can provide a nice buffer against drawdowns in other positions and a passive income stream.
And interestingly enough, several tech stocks – Microsoft (MSFT - Free Report) , NetEase (NTES - Free Report) , and International Business Machines (IBM - Free Report) – reward their shareholders with quarterly payouts.
Let’s take a closer look at each.
Microsoft
Microsoft shares have been big-time outperformers in 2023 thanks to artificial intelligence excitement and a broader sentiment shift overall. Analysts have taken a bullish stance on the company’s current year outlook, with the $11.13 Zacks Consensus EPS Estimate 2% higher over the last year.
MSFT shares presently yield a respectable 0.8% annually, modestly above the respective Zacks sector average. And the tech titan has shown a commitment to shareholders, carrying a 10% five-year annualized dividend growth rate.
Microsoft’s cash-generating abilities help secure the payout. The company generated a sizable $59.5 billion in free cash flow in FY23, with the trailing twelve-month figure totaling an equally impressive $63.3 billion.
NetEase
NetEase, Inc. is an Internet technology company engaged in the development of applications, services, and other technologies for the Internet in China. The stock is a Zacks Rank #2 (Buy), with earnings expectations moving higher across all timeframes.
Shares currently yield a solid 2.3% annually paired with a sustainable payout ratio sitting at 36% of the company’s earnings. And NetEase has shown a notable commitment to increasingly rewarding shareholders, boasting a 27% five-year annualized dividend growth rate.
In addition, the company’s growth profile is impossible to ignore, with consensus expectations for its current year suggesting 45% earnings growth on 2% higher sales. Peeking ahead to FY24, estimates allude to an additional 8% earnings growth paired with a 12% revenue bump.
IBM
IBM is an information technology (IT) company. Shares have been considerable outperformers over the last three months, up 18% compared to the S&P 500’s 11% gain on the back of better-than-expected quarterly results.
Shares currently yield a sizable 4.1% annually, nowhere near the 0.7% average within the Zacks Computer and Technology sector. Impressively, the company is a member of the elite Dividend Aristocrats group, showing a commendable commitment to shareholders through 25+ years of increased payouts.
Bottom Line
Investors love tech stocks. And dividends.
For those seeking exposure to each, all three above – Microsoft (MSFT - Free Report) , NetEase (NTES - Free Report) , and International Business Machines (IBM - Free Report) – fit the criteria nicely.
Zacks Naming Top 10 Stocks for 2024
Want to be tipped off early to our 10 top picks for the entirety of 2024?
History suggests their performance could be sensational.
From 2012 (when our Director of Research, Sheraz Mian assumed responsibility for the portfolio) through November, 2023, the Zacks Top 10 Stocks gained +974.1%, nearly TRIPLING the S&P 500’s +340.1%. Now Sheraz is combing through 4,400 companies to handpick the best 10 tickers to buy and hold in 2024. Don’t miss your chance to get in on these stocks when they’re released on January 2.
Be First to New Top 10 Stocks >>
Tech stocks have been red-hot in 2023, delivering outsized gains. They’ve jumped back in favor following a tough 2022, with expectations of a less-hawkish fed helping drive performances.
Other than tech stocks, investors also love dividends, as they can provide a nice buffer against drawdowns in other positions and a passive income stream.
And interestingly enough, several tech stocks – Microsoft (MSFT - Free Report) , NetEase (NTES - Free Report) , and International Business Machines (IBM - Free Report) – reward their shareholders with quarterly payouts.
Let’s take a closer look at each.
Microsoft
Microsoft shares have been big-time outperformers in 2023 thanks to artificial intelligence excitement and a broader sentiment shift overall. Analysts have taken a bullish stance on the company’s current year outlook, with the $11.13 Zacks Consensus EPS Estimate 2% higher over the last year.
MSFT shares presently yield a respectable 0.8% annually, modestly above the respective Zacks sector average. And the tech titan has shown a commitment to shareholders, carrying a 10% five-year annualized dividend growth rate.
Microsoft’s cash-generating abilities help secure the payout. The company generated a sizable $59.5 billion in free cash flow in FY23, with the trailing twelve-month figure totaling an equally impressive $63.3 billion.
NetEase
NetEase, Inc. is an Internet technology company engaged in the development of applications, services, and other technologies for the Internet in China. The stock is a Zacks Rank #2 (Buy), with earnings expectations moving higher across all timeframes.
Shares currently yield a solid 2.3% annually paired with a sustainable payout ratio sitting at 36% of the company’s earnings. And NetEase has shown a notable commitment to increasingly rewarding shareholders, boasting a 27% five-year annualized dividend growth rate.
In addition, the company’s growth profile is impossible to ignore, with consensus expectations for its current year suggesting 45% earnings growth on 2% higher sales. Peeking ahead to FY24, estimates allude to an additional 8% earnings growth paired with a 12% revenue bump.
IBM
IBM is an information technology (IT) company. Shares have been considerable outperformers over the last three months, up 18% compared to the S&P 500’s 11% gain on the back of better-than-expected quarterly results.
Shares currently yield a sizable 4.1% annually, nowhere near the 0.7% average within the Zacks Computer and Technology sector. Impressively, the company is a member of the elite Dividend Aristocrats group, showing a commendable commitment to shareholders through 25+ years of increased payouts.
Bottom Line
Investors love tech stocks. And dividends.
For those seeking exposure to each, all three above – Microsoft (MSFT - Free Report) , NetEase (NTES - Free Report) , and International Business Machines (IBM - Free Report) – fit the criteria nicely.
Zacks Naming Top 10 Stocks for 2024
Want to be tipped off early to our 10 top picks for the entirety of 2024?
History suggests their performance could be sensational.
From 2012 (when our Director of Research, Sheraz Mian assumed responsibility for the portfolio) through November, 2023, the Zacks Top 10 Stocks gained +974.1%, nearly TRIPLING the S&P 500’s +340.1%. Now Sheraz is combing through 4,400 companies to handpick the best 10 tickers to buy and hold in 2024. Don’t miss your chance to get in on these stocks when they’re released on January 2.
Be First to New Top 10 Stocks >>
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