IBM ( IBM -0.09% ) While IBM may not be considered one of the “Magnificent Seven” companies, it is still highly valued by shareholders seeking income. Despite being an older technology company, IBM offers a respectable yield and remains relevant in the ever-changing financial markets, which may go unnoticed by some investors searching for new opportunities.
It would be a mistake to underestimate IBM as outdated, as the company recently launched a cutting-edge generative artificial intelligence (AI) cybersecurity assistant that is very pertinent in current times. CrowdStrike Take advantage of the opportunity to earn some extra profit by investing your money in both the traditional and modern IBM options during this update fiasco.
What is the dividend yield for IBM stock?
Since 2020, IBM has consistently increased its quarterly dividend by $0.01 annually. Although IBM’s dividend growth rate is not high, the current dividend payout of $1.67 per quarter, or $6.68 per year, is relatively decent.
Compared to the technology sector’s average annual dividend yield of 1.025%, IBM offers a substantial yield of 3.47%, demonstrating a strong commitment to rewarding its shareholders with capital.
IBM maintains a steady cash flow.
Equally significant is the fact that IBM’s stock has been consistently rising over the long term. This means that shareholders have not had to give up potential increases in share value in order to receive higher dividend payments.
Additionally, IBM’s financial reports indicate that the company is well-positioned to sustain its quarterly dividend payouts. In the second quarter of 2024, the company experienced a 2% year-over-year growth in revenue, reaching $15.8 billion, and also raised its accounting standards commonly recognized and used by businesses and organizations -The gross profit margin increased by 180 basis points to reach 56.8%.
In addition, IBM’s available cash increased by $1.1 billion to reach $4.5 billion in the second quarter of 2024. While these figures may not be as impressive as those of certain top-performing companies, they demonstrate that IBM’s financial stability is strong enough to support ongoing, modest increases in dividend payments that have become anticipated by long-standing investors in IBM.
