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Tech Dividend Yields Pre-Earnings: AAPL, MSFT, DIS


Oct. 7 2019, Updated 3:52 p.m. ET

Tech stocks Apple (AAPL), Microsoft (MSFT), and the Walt Disney Company (DIS) have been putting up mixed performances this month. October is proving to be a weak month for the equity market. But while it’s being plagued by recession fears, it’s also being supported by optimism related to US-China trade talks.

Tech stocks are now gearing up for their next earnings season. Perhaps it’s the right time to review their dividend yields.

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Tech stocks, dividend yields, and upcoming earnings

Microsoft’s dividend yield has risen to 1.5% due to the stock’s decline. The stock has fallen in line with the weaker equity market. It’s down 0.7% so far in October. In the quarter that ended in September, analysts expect Microsoft’s earnings to have risen 9% YoY.

While Apple stock has risen 1.4% this month, Disney stock has been flat. Their dividend yields currently stand at 1.4% each. Analysts expect Apple’s and Disney’s earnings to have fallen 3% and 35%, respectively, in the quarter that ended in September.

Other tech stocks Amazon (AMZN), Facebook (FB), and Netflix (NFLX) have risen 0.2%, 1.3%, and 1.9%, respectively, so far this month. However, Alphabet (GOOGL) (GOOG) and Twitter (TWTR) have fallen 0.8% and 2.0%, respectively, so far.

Wall Street analysts expect Amazon’s, Google’s, and Twitter’s earnings to fall 21%, 5%, and 3% YoY, respectively, in their upcoming results. In contrast, they expect Facebook’s and Netflix’s earnings to rise 8% and 17% YoY, respectively.

Tech stock Microsoft’s dividends and share repurchases

Microsoft has consistently paid steady dividends for the past several years. In the second quarter of fiscal 2020, Microsoft will pay a dividend of $0.51 per share on December 12, 2019. The company announced the dividend on September 18. This dividend payment reflects 11% YoY growth. Besides the dividend hike, Microsoft has also authorized $40 billion for a new share buyback program. To learn more, read Microsoft Stock: Dividend Hike, Buybacks Attract Investors.

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On its latest earnings call, Microsoft’s executive vice president and CFO, Amy Hood, said, “This quarter, we returned $7.7 billion to shareholders through share repurchases and dividends, an increase of 45%, bringing our total cash returned to shareholders to over $30 billion for the full fiscal year.”

Apple’s dividend and buybacks

In the fourth quarter of fiscal 2019, Apple paid a dividend of $0.77 per share on August 15. The company announced the dividend on July 30, 2019. The dividend payment shows a 6% YoY increase. Apple is also consistently buying back shares. In the nine months that ended in June, Apple repurchased around $49 billion worth of shares.

Disney’s dividend payments

Disney has consistently paid steady dividends for the past several years. In the third quarter of fiscal 2019, Disney paid a dividend of $0.88 per share on July 25. The company announced the dividend on June 26. The dividend payment reflects 5% YoY growth.

Disney didn’t repurchase any shares in the nine months that ended in June. To learn more, read When Can Disney Resume Its Share Buyback Program?


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