Zacks Investment Ideas feature highlights: ASML, Apple and Broadcom

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For Immediate Release

Chicago, IL – July 10, 2024 – Today, Zacks Investment Ideas feature highlights ASML ASML, Apple AAPL and Broadcom AVGO.

Like Dividends? 3 Tech Stocks Worth a Look

Tech stocks have been the craze for some time, with their performance recently boosted by the artificial intelligence (AI) frenzy. The sector has jumped into the favorite pick for many, with outsized gains keeping investors happy.

Other than tech stocks, a fair portion of investors also love dividends, as they can provide a nice buffer against drawdowns in other positions and a passive income stream.

In addition, dividend-paying companies are typically well-established and able to share a portion of their profits with shareholders without experiencing a negative financial impact.

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For those interested in exposure to each, several tech stocks, including ASML, Apple and Broadcom, reward their shareholders with quarterly payouts.

Let’s take a closer look at each.

Apple Shares Bounce Back

Apple shares have bounced back strongly over the last month after a slow start to the year, gaining 17% on favorable news concerning China iPhone shipments and broader AI excitement. Analysts have modestly raised their earnings expectations, helping land the stock a Zacks Rank #2 (Buy).

Strong cash-generating abilities have allowed it to consistently boost its quarterly payout over the years, with Apple recently delivering its 12th consecutive year of higher payouts. Shares yield a modest 0.5% annually, though the company’s 4.9% five-year annualized dividend growth shows a commitment to shareholders.

The company’s growth profile remains positive, with consensus expectations for its current fiscal year suggesting 7.5% EPS growth on 1% higher sales. Peeking ahead to FY25, expectations allude to an additional 12% EPS growth paired with an 8% sales climb.

ASML Keeps Raising Quarterly Payouts

ASML shares have been big-time performers in 2024 on the back of the broader semiconductor trade, gaining 43% and seeing performance aided by better-than-expected quarterly results. The stock sports a favorable Zacks Rank #2 (Buy).

The company has long displayed a shareholder-friendly nature, sporting a sizable 30.7% five-year annualized dividend growth rate. Shares currently yield 0.6% annually paired with a sustainable payout ratio sitting at 27% of the company’s earnings.

Broadcom Upgrades Sales Outlook

Broadcom shares have similarly benefitted from the semiconductor trade, gaining an impressive 60% YTD and trading near all-time highs. The company’s recent set of quarterly results brought post-earnings fireworks, with record revenue from AI products of $3.1 billion pleasing investors.

Following its latest release, the company raised its current-year sales outlook, with analysts’ revisions also moving accordingly.

Like AAPL, strong cash-generating abilities have allowed it to consistently increase its quarterly payouts, sporting a 14% five-year annualized dividend growth rate. Free cash flow of $5.3 billion throughout its latest period climbed 18% year-over-year.

The company’s forecasted growth is impossible to ignore, with consensus expectations for its current fiscal year suggesting 12% EPS growth on 43% higher sales.

Bottom Line

Tech stocks have been the craze for some time now, with excitement surrounding AI and a resilient economy providing tailwinds.

And for those interested in joining the trade with an appetite for income, all three stocks above fit that criteria nicely.

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Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.

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Apple Inc. (AAPL) : Free Stock Analysis Report

ASML Holding N.V. (ASML) : Free Stock Analysis Report

Broadcom Inc. (AVGO) : Free Stock Analysis Report

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