Microchip Technology Inc. (MCHP), Maxim Integrated Products Inc. (MXIM): Consider These Under the Radar Tech Stocks

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Income investors are in a tough spot. Because of the Federal Reserve’s ongoing quantitative easing program, interest rates are at historic lows. As a result, traditional fixed income products such as bank certificates of deposit or government bonds pay little interest. Even riskier fixed income assets, such as corporate bonds, have rallied considerably and now provide yields that are nothing to write home about.

Consequently, many income investors have turned to equities as sources of yield. Surprisingly, the technology sector has become something of a haven for income investors. While the mega-cap technology giants are indeed paying solid dividend yields, there are smaller tech companies that pay generous dividends to shareholders as well. Here’s a few to get you started.

Microchip Technology Inc. (NASDAQ:MCHP)

Small companies, but big dividends

Microchip Technology Inc. (NASDAQ:MCHP) is a $7 billion semiconductor company. Microchip Technology Inc. (NASDAQ:MCHP) has a solid dividend track record, increasing its shareholder payout every year since 2002. Recently, the company has inched its dividend upward every quarter. Microchip Technology Inc. (NASDAQ:MCHP) offers a solid payout, as its last four quarterly distributions add up to a 3.7% yield.

Microchip Technology Inc. (NASDAQ:MCHP)’s dividend is backed up by its underlying fundamentals. The company recently reported record net sales of $1.582 billion on a GAAP basis.

Maxim Integrated Products Inc. (NASDAQ:MXIM) is a $9 billion company that operates in the semiconductor industry, and engages in designing and developing integrated circuits worldwide. The company carries a well-capitalized balance sheet, with more than $1.5 billion in cash on the books and a reasonable long-term debt to equity ratio of 30%.

In addition, the company has more than enough liquidity to meet its short-term obligations, as evidenced by its 3.30 current ratio. This means that the company has $3 in current assets for every $1 in current liabilities.

Maxim Integrated Products Inc. (NASDAQ:MXIM) offers its investors a healthy dividend in addition to its rock-solid balance sheet. The company pays a 3% dividend and raised its dividend 9% late last year.

Molex Incorporated (NASDAQ:MOLX) carries a market capitalization of $5 billion and a dividend yield north of 3%. Molex designs and manufactures electronic components.

Molex Incorporated (NASDAQ:MOLX) recently released a decent third-quarter earnings report, showing that net revenue increased 2% year-over-year. The company also announced a 9% dividend increase, bringing the payout to its new level of $0.96 per share, meaning the stock offers investors a hefty 3.2% yield at recent prices.

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