Caterpillar Inc. (CAT) and Broadcom Inc. (AVGO) are emerging as strong investment options in the artificial intelligence (AI) sector due to their robust dividend payouts and growth potential. Caterpillar reported a significant increase in demand for its power products used in data centers, deploying $7.9 billion for share repurchases and dividends in FY25, while also maintaining its status as a Dividend Aristocrat. Broadcom, a key player in AI infrastructure, achieved 48% year-over-year sales growth, backed by high demand for its custom AI chips and networking solutions.
Both companies are poised for further success; analysts have raised earnings estimates for Caterpillar, which currently holds a Zacks Rank #2 (Buy), while Broadcom showcases a 13.1% annualized dividend growth rate over five years. These characteristics make them appealing to investors seeking income alongside exposure to technological advancements.
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