From 24/7 Wall St. · Chris Lange · · 1m 50s
Chip Giants Boost Dividends Amid Cash Flow Growth
Three chipmakers raise dividends using strong cash flows despite market downturns.
In brief
Three chipmakers raise dividends using strong cash flows despite market downturns. Texas Instruments, Analog Devices, and Qualcomm increased dividends through 2008-2009 financial crisis and recent market challenges. Originally reported by 24/7 Wall St..
Chip Giants Boost Dividends Amid Cash Flow Growth
Income investors usually skip tech because the yields look thin but a small group of chipmakers have been quietly compounding their payouts through recessions and market downturns.
Texas Instruments Raises Quarterly Dividend
Texas Instruments just raised its quarterly dividend to $1.52 per share, replacing the prior $1.42, a 7.0% increase.
Texas Instruments Cash Flow Strength
Analog revenue reached $4.365B last quarter, up 26%, while embedded processing brought in $788M, up 16%.
Texas Instruments Dividend Safety
Dividends per share of $5.62 against trailing EPS of $6.57 work out to a payout ratio of about 86%.
Texas Instruments Dividend Track Record
TI’s dividend history shows a higher payout every year from 2005 through this year, rising from $0.10 to $0.12 during the financial crisis.
Analog Devices Raises Dividend
Analog Devices raised its quarterly dividend to $1.10, up from $0.99, a 11.1% increase, the largest of the three.
Analog Devices Cash Flow Strength
Industrial customers produced $1.972B of revenue last quarter (+53%), and communications revenue reached $655M (+84%).
Qualcomm Raises Dividend
Qualcomm raised its quarterly dividend to $0.92, up from $0.89, a 3.4% increase, with a 2.07% yield.
Qualcomm Cash Flow Strength
Qualcomm’s 6.98% free cash flow yield is far above the dividend yield, with $937 million in dividends paid last quarter.
Three Chipmakers' Dividend Strategies
Each company kept its dividend through the 2008-2009 financial crisis and has raised it this year, with Texas Instruments offering the longest unbroken record of raises.
The bottom line
Texas Instruments, Analog Devices, and Qualcomm increased dividends through 2008-2009 financial crisis and recent market challenges.
