The technology sector is generally associated with growth stocks. Many stocks do not pay dividends, although this has begun to change. 

The technology sector now contains many quality dividend stocks with strong yields. This article will discuss 3 blue-chip tech stocks with dividend yields above the S&P 500 Index average.

Broadcom Inc. (AVGO)

Broadcom designs, develops and sells semiconductors under the following business units: Wired infrastructure, wireless communication, enterprise storage and industrial. Its offerings include data center chips, factory automation, energy systems and power generation, broadband access, and home connectivity. Broadcom is a fabless semiconductor company, which means that the products it designs are manufactured by other companies/foundries.

Broadcom reported its first quarter earnings results in March. The company generated revenues of $8.9 billion during the quarter, which represents an increase of 16% compared to the prior year’s quarter. The strong revenue growth performance was possible thanks to beating estimates in the semiconductor solutions unit, while its Infrastructure software business generated solid growth as well.

The company reported earnings-per-share of $10.33 for the first quarter, which was ahead of the analyst consensus estimate. The company expects that revenues will come in at $8.7 billion during the second quarter of the current fiscal year.

Broadcom’s biggest market is wireless communication, where the company owns a strong connectivity portfolio that includes advanced LTE, Bluetooth 5.x, Wi-Fi, GNSS (GPS, Galileo, etc.), and more. It is also well positioned in the enterprise storage market, where it provides switching and other connectivity solutions and storage products such as SSD controllers. Shares currently yield 2.9%.

Garmin Ltd. (GRMN)

Garmin is a technology company based in Switzerland. It manufactures navigation, communication, and information devices and applications that are enabled by GPS. Its business segments are as follows: Auto, Aviation, Marine, Outdoor, and Fitness.

The Auto segment offers auto navigation products for vehicles. The Aviation segment includes navigation, communications transmitters and receivers, multi-function displays, electronic flight instrumentation systems, automatic flight control systems, and traffic advisory systems. The Marine segment includes products for recreational boats. The Outdoor segment makes products for outdoor activities, while the Fitness segment makes products designed for activity tracking.

Garmin produces about $5 billion in annual revenue and has a $20 billion market capitalization. Garmin posted first quarter earnings on May 3rd, 2023, and results were ahead of expectations on both revenue and profits. The company posted adjusted earnings-per-share of $1.02, which was a penny ahead of estimates. Revenue was down 2% year-over-year to $1.15 billion, but was $60 million than expected. The company noted four of its five segments posted double-digit revenue growth, driven by new product introductions and strong demand from consumers.

The company has increased its dividend for the past five years. Shares currently yield 2.9%.

Texas Instruments (TXN)

Texas Instruments is a semiconductor company that operates two business units: Analog and Embedded Processing. Its products include semiconductors that measure sound, temperature and other physical data and convert them to digital signals, as well as semiconductors that are designed to handle specific tasks and applications.

First-quarter revenue declined 11% versus the previous year’s quarter but beat analyst estimates by $10 million, as the analyst community had forecasted a weaker sales performance. Texas Instruments managed to keep its gross profit margin at an attractive level of 65%, while the company’s operating profit margin of 44% remained strong as well. Texas Instruments generated earnings-per-share of $1.85 during the first quarter, which was better than the consensus estimate, coming in $0.07 ahead of the analyst community’s forecast.

Thanks to its cash generation, Texas Instruments was able to finance shareholder returns of $7.5 billion during the last four quarters. The company guides for revenues of $4.35 billion and for earnings-per-share of around $1.75 for the second quarter of 2023.

The company has increased its dividend for 19 consecutive years. Shares currently yield 3%.

Disclosure: No positions
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Bob Ciura has worked at Sure Dividend since October 2016. He oversees all content for Sure Dividend and its partner sites. Bob received a Bachelor’s degree in Finance from DePaul University, and an MBA with a concentration in Investments from the University of Notre Dame.