Tech Dividend Payers Offer Good Value

By Kiplinger's Retirement Report

During the dot-com bubble of the late 1990's, it was rare for a technology stock to pay a dividend.  Since then, the dividend landscape in the tech sector has changed big time - attracting marquee names such as Microsoft and IBM, and lately Apple.

Today, 68% of technology stocks in Standard & Poor's 500-stock index pay a dividend.  And those dividend-paying tech stocks contribute a larger percentage of the index's indicated dividend than any other sector.

Tech stocks currently sell at a price-to-earnings ratio slightly lower than that of large-company U.S. stocks.  That does not mean they are bargains, but many offer decent value.  And dividend-paying technology stocks are likely to provide much more growth than traditional income sectors such as utilities.

If you like the idea of technology stocks, but do not want to buy individual stocks, consider First Trust NASDAQ Technology Dividend Fund (TDIV).  The exchange traded fund currently holds 87 stocks in the technology and telecommunications sectors.  While telecom is limited to 20% of holdings, it does help boost the portfolio's yield.  To be included in this fund, a stock must not have cut its dividend within the past 12 months.

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First Trust NASDAQ Technology Dididend Income Fund (TDIV) is a component of the D2 Capital Management Multi-Asset Income Portfolio.  Current TDIV dividend yield is 2.32%.

Disclosure:  I own the D2 Capital Management Multi-Asset Income Portfolio

The views expressed here are that of myself or the cited individual or firm and do not constitute a recommendation, solicitation, or offer by myself, D2 Capital Management, LLC or its affiliates to buy or sell any securities, futures, options or other financial instruments or provide any investment advice or service. D2, its clients, and its employees may or may not own any of the securities (or their derivatives) mentioned in this article.

 The Jacksonville Business Journal has ranked D2 Capital Management in the top 25 of Certified Financial Planners in Jacksonville.  The Firm is also a member of the Financial Planning Association of Northeast Florida, the Jacksonville Chamber of Commerce, the Southside Businessmen's Club, and the Beaches Business Association.