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4 Tech Stocks With Dividend Power

Increasingly sweet payouts put these companies in the spotlight

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Seagate Technology

Seagate STXDividend Yield: 3.4%

Another big climber and big yielder comes via hard drive maker Seagate Technology (STX), which has soared roughly 50% year-to-date.

It’s fair to point out that Seagate did stop paying its dividend during the 2008-09 downturn, and waited until 2011 to reinstate it. However, the refreshed dividend, at 18 cents quarterly, started out 50% better than its final 2008 payout, and since then it has ballooned to 38 cents per share.

Seagate actually took the No. 4 spot for trailing dividend growth at the end of Q2 — a bit surprising considering the company’s earnings moved in the other direction. STX has suffered sales and earnings weakness in the face of a declining PC market, and also has meager earnings growth slated long-term.

The tech stock’s dividend still looks solid enough, though. Its current 38-cent payout will tally a total of $1.52 per share for the full-year, which is less than 30% of expected earnings. And for the most recent fiscal year, which ended in July, Seagate’s total dividend used up only about a quarter of its free cash flow.

Meanwhile, CEO Steve Luczo remains confident in STX’s ability to adapt, saying on the most recent earnings call that Seagate will benefit from “data growth driven by cloud, mobile and open source advancement.”

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