QUALCOMM, Inc. (QCOM) Flirts With Highs Thanks to a Dividend Boost: Intel Corporation (INTC), NVIDIA Corporation (NVDA)

Catching up with Intel in another way
On top of the dividend, Qualcomm is also effectively doubling its share repurchase authorization. The company is replacing its current $4 billion repurchase authorization, which only had $2.5 billion left, with a new $5 billion repurchase program. The company noted that since initiating dividends and buybacks a decade ago, the company has returned a total of $19.9 billion to shareholders. That’s a generous return of capital considering Qualcomm’s current market cap is over $115 billion.

Qualcomm has now become the Intel Corporation (NASDAQ:INTC) of the mobile era, symbolically overtaking the PC chip giant in valuation late last year. Over the past few months, Qualcomm has extended its lead and is now worth $10 billion more than Intel Corporation (NASDAQ:INTC). However, one area where Qualcomm still lags its traditional chip-making rival is dividend yield.

Sources: Intel and Qualcomm.

Value investors may still prefer Intel’s payout, which yields two times as much as Qualcomm, even though Qualcomm has greater growth prospects going forward. IDC expects PC shipments to decline by a modest 1.3% in 2013, while the researcher expects smartphones to outsell feature phones for the first time this year on strong growth.

Following the announcement, shares have rallied and are flirting with new highs as investors are happy to be getting even more back.

The article Qualcomm Flirts With Highs Thanks to a Dividend Boost originally appeared on Fool.com and is written by Evan Niu, CFA.

Fool contributor Evan Niu, CFA, owns shares of Apple and Qualcomm. The Motley Fool recommends Apple, Intel, and NVIDIA. The Motley Fool owns shares of Apple, Intel, and Qualcomm.

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