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Technology’s momentum is undeniably attractive to investors, with the high-flying sector delivering notable gains and boosting sentiment over the last year. In fact, the Zacks Computer and Technology sector has gained nearly 48% over the period compared to the S&P 500’s impressive 25% gain.
Investors also love dividends, as they provide a nice buffer against drawdowns and provide a passive income stream, undoubtedly a solid pairing. And for those seeking exposure to both technology and dividends, three stocks – Dell Technologies (DELL - Free Report) , Qualcomm (QCOM - Free Report) , and IBM (IBM - Free Report) – fit the criteria nicely.
On top of rewarding shareholders with quarterly payouts, all three sport a favorable Zacks Rank, reflecting optimism among analysts. Let’s take a closer look at each.
Dell Technologies
Dell Technologies, a current Zacks Rank #2 (Buy), provides information technology solutions. The company’s shares currently yield 1.7% annually paired with a sustainable payout ratio sitting at 26% of its earnings.
The outlook for its current fiscal year has been notably positive, with the $6.66 Zacks Consensus EPS estimate up 8% over the last year. Better-than-expected quarterly results over the last year have helped drive share performance, with DELL exceeding the Zacks Consensus EPS estimate by an average of 36% across its last four releases.
Image Source: Zacks Investment Research
It’s worth noting that the company’s growth is expected to cool in its current fiscal year (FY24), with consensus expectations alluding to a 12% pullback in earnings on 13% lower sales.
Qualcomm
Qualcomm, a current Zacks Rank #2 (Buy), designs, manufactures, and markets digital wireless telecom products and services based on the Code Division Multiple Access (CDMA) technology. Analysts have bumped their earnings expectations higher across the board.
Image Source: Zacks Investment Research
QCOM shares pay investors nicely, currently yielding 2.1% annually. The company has shown a commitment to increasingly rewarding shareholders, as reflected by its 6.3% five-year annualized dividend growth rate.
Image Source: Zacks Investment Research
The company’s latest set of quarterly results came in above expectations, posting a 15% beat relative to the Zacks Consensus EPS estimate and reporting sales 4.5% ahead of the consensus. Headline numbers exceeded the high end of prior guidance, with the company also returning $1.7 billion to shareholders through buybacks and dividend payouts.
IBM
IBM, a current Zacks Rank #2 (Buy), is an information technology (IT) company. Analysts have moved their earnings expectations higher across the board over the last several months. Shares presently yield 3.6% annually, crushing the Zacks Computer and Technology sector average of 0.6%.
Image Source: Zacks Investment Research
IBM’s latest set of quarterly results came in above expectations, with Software sales climbing 8% year-over-year as customers increasingly adopt its watsonx AI and data platform. Cash-generating abilities also saw a notable boost, with operating cash flow of $3.1 billion well higher than the $1.9 billion mark in the year-ago period.
IBM shares have moved higher post-earnings in back-to-back releases, as we can see below.
Image Source: Zacks Investment Research
Bottom Line
Dividend-paying stocks don’t always have to be ‘boring,’ as many exciting companies from the technology sector also reward their shareholders with payouts.
And for those interested in gaining exposure to the sector paired with quarterly payouts, all three stocks above – Dell Technologies (DELL - Free Report) , Qualcomm (QCOM - Free Report) , and IBM (IBM - Free Report) – fit the criteria nicely.
On top of quarterly payouts, all three currently sport a favorable Zacks Rank, reflecting positive outlooks among analysts.
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3 Tech Stocks to Buy for Passive Income
Technology’s momentum is undeniably attractive to investors, with the high-flying sector delivering notable gains and boosting sentiment over the last year. In fact, the Zacks Computer and Technology sector has gained nearly 48% over the period compared to the S&P 500’s impressive 25% gain.
Investors also love dividends, as they provide a nice buffer against drawdowns and provide a passive income stream, undoubtedly a solid pairing. And for those seeking exposure to both technology and dividends, three stocks – Dell Technologies (DELL - Free Report) , Qualcomm (QCOM - Free Report) , and IBM (IBM - Free Report) – fit the criteria nicely.
On top of rewarding shareholders with quarterly payouts, all three sport a favorable Zacks Rank, reflecting optimism among analysts. Let’s take a closer look at each.
Dell Technologies
Dell Technologies, a current Zacks Rank #2 (Buy), provides information technology solutions. The company’s shares currently yield 1.7% annually paired with a sustainable payout ratio sitting at 26% of its earnings.
The outlook for its current fiscal year has been notably positive, with the $6.66 Zacks Consensus EPS estimate up 8% over the last year. Better-than-expected quarterly results over the last year have helped drive share performance, with DELL exceeding the Zacks Consensus EPS estimate by an average of 36% across its last four releases.
Image Source: Zacks Investment Research
It’s worth noting that the company’s growth is expected to cool in its current fiscal year (FY24), with consensus expectations alluding to a 12% pullback in earnings on 13% lower sales.
Qualcomm
Qualcomm, a current Zacks Rank #2 (Buy), designs, manufactures, and markets digital wireless telecom products and services based on the Code Division Multiple Access (CDMA) technology. Analysts have bumped their earnings expectations higher across the board.
Image Source: Zacks Investment Research
QCOM shares pay investors nicely, currently yielding 2.1% annually. The company has shown a commitment to increasingly rewarding shareholders, as reflected by its 6.3% five-year annualized dividend growth rate.
Image Source: Zacks Investment Research
The company’s latest set of quarterly results came in above expectations, posting a 15% beat relative to the Zacks Consensus EPS estimate and reporting sales 4.5% ahead of the consensus. Headline numbers exceeded the high end of prior guidance, with the company also returning $1.7 billion to shareholders through buybacks and dividend payouts.
IBM
IBM, a current Zacks Rank #2 (Buy), is an information technology (IT) company. Analysts have moved their earnings expectations higher across the board over the last several months. Shares presently yield 3.6% annually, crushing the Zacks Computer and Technology sector average of 0.6%.
Image Source: Zacks Investment Research
IBM’s latest set of quarterly results came in above expectations, with Software sales climbing 8% year-over-year as customers increasingly adopt its watsonx AI and data platform. Cash-generating abilities also saw a notable boost, with operating cash flow of $3.1 billion well higher than the $1.9 billion mark in the year-ago period.
IBM shares have moved higher post-earnings in back-to-back releases, as we can see below.
Image Source: Zacks Investment Research
Bottom Line
Dividend-paying stocks don’t always have to be ‘boring,’ as many exciting companies from the technology sector also reward their shareholders with payouts.
And for those interested in gaining exposure to the sector paired with quarterly payouts, all three stocks above – Dell Technologies (DELL - Free Report) , Qualcomm (QCOM - Free Report) , and IBM (IBM - Free Report) – fit the criteria nicely.
On top of quarterly payouts, all three currently sport a favorable Zacks Rank, reflecting positive outlooks among analysts.