HomeMost PopularTech Stocks 3 Tech Stocks Suited Nicely for Income Investors Unlocking Profits: 3 Tech Titans...

3 Tech Stocks Suited Nicely for Income Investors Unlocking Profits: 3 Tech Titans Enticing Income Investors

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Tech stocks are the fiery dragons of the investment realm in 2023, rising with the tempestuous winds of a rebound after a floundering 2022. Their revival comes in tow with the sagacious expectation of a less-hawkish Federal Reserve, propelling their performances to new dizzying heights.

It’s a truth universally acknowledged by investors that dividends are a cozy quilt during market downturnsβ€”a cushioning buffer against potential losses and a bubbling brook of passive income.

Curiously, amidst this melee, we find several tech stocks – Microsoft (MSFT), NetEase (NTES), and International Business Machines (IBM) – graciously bestowing bountiful quarterly payouts upon their shareholders.

Lets dig into each of these intriguing prospects.

Microsoft

Microsoft shares reign supreme in 2023 due to the frenzy surrounding artificial intelligence and a seismic shift in overall sentiment. Analysts raise a bullish toast to the company’s current-year outlook, with the $11.13 Zacks Consensus EPS Estimate sitting 2% higher than the previous year’s records.

Zacks Investment Research
Image Source: Zacks Investment Research

MSFT shares presently offer a decent 0.8% annual yield, modestly edging above the respective Zacks sector average. The tech giant has stamped a lasting commitment to its shareholders, with a commendable 10% five-year annualized dividend growth rate.

Zacks Investment Research
Image Source: Zacks Investment Research

Microsoft’s prowess in generating cash fortifies its ability to dispense dividends. In FY23, the company hoarded a substantial $59.5 billion in free cash flow, with the trailing twelve-month figure closing in at an equally staggering $63.3 billion.

NetEase

NetEase, Inc. is an Internet technology company engaged in weaving applications, services, and other technologies for the Internet in Chinese markets. The stock is a Zacks Rank #2 (Buy), with earnings expectations ascending across all timeframes.

Zacks Investment Research
Image Source: Zacks Investment Research

Shares presently bear a substantial 2.3% annual yield, paired with a sustainable payout ratio lounging at 36% of the company’s earnings. NetEase has notably danced the tango of increasingly rewarding its shareholders, brandishing a flamboyant 27% five-year annualized dividend growth rate.

Zacks Investment Research
Image Source: Zacks Investment Research

In addition, the company’s growth profile is impossible to ignore, with consensus expectations for its current year hinting at a staggering 45% earnings growth atop 2% higher sales. Looking into FY24, estimates whisper of an additional 8% earnings growth coupled with a 12% revenue uptick.

IBM

IBM is an information technology (IT) company. Shares are the golden eagles of the last three months, soaring 18% higher than the S&P 500’s 11% gain, following better-than-expected quarterly results.

They presently bear a substantial 4.1% annual yield, in a realm far off the 0.7% average skulking within the Zacks Computer and Technology sector. Impressively, the company has earned a spot in the prestigious Dividend Aristocrats group, showcasing an unwavering dedication to its shareholders with over 25 years of inciting increased payouts.

Zacks Investment Research
Image Source: Zacks Investment Research

Bottom Line

Investors are smitten kittens with tech stocks. And dividends? They’re more popular than coffee at a morning meeting.

For those seeking a dalliance with both, all three above – Microsoft (MSFT), NetEase (NTES), and International Business Machines (IBM) – fit the criteria as snugly as a sock on a foot.

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Microsoft Corporation (MSFT) : Free Stock Analysis Report

International Business Machines Corporation (IBM) : Free Stock Analysis Report

NetEase, Inc. (NTES) : Free Stock Analysis Report

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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