The Magic Combination: Tech Stocks And Dividends

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Back in the 1990s, such a thing barely existed as technology growth companies didn’t want to be seen as an “old” company that paid dividends.

But that changed in the 2000s as cash hoards grew and pressure mounted from shareholders to share the wealth.

In 2003, Microsoft became the first of the newer tech titans to pay a dividend and it opened up the floodgates for others. Apple AAPL finally began paying one in 2012.

Which of the tech stocks give you the best bang for your buck with dividends?

5 Top Tech Stocks That Pay Dividends

1.    In 2003, Microsoft (MSFT - Free Report) paid just $870 million in dividends. For fiscal 2016, it was $16 billion yet the company still has $126 billion cash on hand as of last quarter. It pays a yield of 2.3%.

2.      Western Digital (WDC - Free Report) generated $1 billion in free cash flow last quarter and has $5.8 billion in cash on hand. The data storage company pays a yield of 2.2%.

3.      Broadcom (AVGO - Free Report) has paid a dividend since 2010. It hasn’t yet reported (it reports earnings this week) but is currently paying 1.7%.

4.      J2 Global (JCOM - Free Report) is a small cap digital media and cloud services company in Los Angeles. It has raised its dividend 23 consecutive quarters. Impressive. It has a yield of 1.8%.

5.      TiVo (TIVO - Free Report) recently combined with Rovi which gave them a strong patent business. About 50% of its revenue comes from licensing due to the patents. It has the juiciest dividend of all, yielding 4.4%.

All of these technology companies also have strong earnings and sales growth so the dividend is just icing on the cake.

Disclosure: Tracey Ryniec is the Value Stock Strategist for Zacks.com. She is also the Editor of the  more

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