Out of all investment styles, income investment is one of the most popular, and there are good reasons for its popularity. Income investment focuses on stocks with high dividends. However, it would be folly to go after a stock with high dividends without paying any heed to other metrics like dividend yield ratio, dividend payout ratio and dividend growth rate. A good income portfolio makes sure that it contains stocks that fulfill all these criteria and then some more. You should also keep in mind that these metrics are generally not comparable across other industries, so while you compare the stocks, make sure that they belong to the same industry. Here is my pick of tech stocks that are good for an income portfolio:
Seagate Technology PLC (NASDAQ:STX): The hard disk drive company is based out of Ireland and offers a wide range of storage solutions to its retail and enterprise clients. While it holds leadership position in its segment, the company is faring equally well when it comes to serving its investors. The stock grew 17 percent in the past 52 weeks, and it also offered 4.73 percent dividend yield. Its dividend seems to have a secure future as the company increased its dividend four-fold in the past five years. Its robust cash flow position is also conducive to the continued payment and growth of the dividend. Seagate Technology PLC (NASDAQ:STX) is currently seeing a sell-off which actually may provide a good entry point for long term investors. Overall, it is a good stock for income investors.
STMicroelectronics N.V. (NYSE:STM): This Swiss company offers a 5 percent dividend yield, and in the past 52 weeks the stock itself grew more than 8 percent. Its upward ascent continues as STMicroelectronics N.V. (ADR) (NYSE:STM) gained 8.7 percent this year so far. The company specializes in semiconductor integrated circuits and is constantly augmenting its product portfolio. It is one of the leading chip makers in Europe and has a steady balance sheet, offering security for the future payments for its dividend. The company recently reported its fourth quarter results, and while its financial numbers lagged behind consensus estimates, it is likely to recover in the coming quarters.
Analog Devices, Inc. (NASDAQ:ADI) : The company recently paid 34 cents per share in dividends, an increase of 13.3 percent over its previous payment. With this dividend, Analog Devices’ dividend yield stands at 3 percent. Additionally, the stock grew 7.5 percent this year so far, while its previous 52 week growth stands at 13 percent. Analog Devices, Inc. (NASDAQ:ADI) also has an 11 year track record of continuously raising its dividend payment. The company derives a major portion of its revenue from enterprise clientele and thus has lower exposure to the mass market, giving more stability to its revenue stream. Analog Devices, Inc. (NASDAQ:ADI) was also named among the top 25 socially responsible dividend stocks. The stock is further expected to benefit from an impending recovery in the semiconductor sector. Since Analog Devices, Inc. (NASDAQ:ADI) Devices is mainly invested in the industrial segment of semiconductors, the likelihood of a recovery is stronger for this company.