If you’re a dividend investor, you might not think to look at tech stocks as potential dividend plays. But more and more tech companies are offering payouts as their businesses become more stable and as they generate more predictable earnings. Meta Platforms (NASDAQ:META), for example, began paying a dividend earlier this year.
Apple (NASDAQ:AAPL) has been paying one for years and while its 0.4% yield may appear low and uninteresting for income investors, there’s a compelling argument for dividend investors to buy the stock. For one, the company has been increasing its dividend on a regular basis. Over the past 10 years, the stock has more than doubled its payouts.
Plus, Apple also makes a ton of money. In the trailing 12 months, its free cash flow has totaled more than $104 billion, and over $15 billion of that was distributed out as dividends; there’s a lot of room for Apple to pay an even higher dividend in the future.
Lastly, there’s the potential for investors to profit from multiple ways from the stock – from the dividend and Apple’s impressive returns over the years. If not for the stock’s impressive gains, the yield would be much higher than it is. But that’s a trade investors would likely be more than happy to make as Apple’s stock is up more than 300% in five years.
For the stability it offers plus the potential for a growing dividend and attractive long-run returns, Apple is a great investment, and one which dividend investors should be careful not to overlook.
