2 Tech Stocks Are Screaming Buys Even at All-Time Highs
When a company initiates a dividend, it signals a lot of faith by the management team. Making the decision to share a piece of a company’s profits indicates the forward picture is healthy.
Two all-star companies, Salesforce.com (CRM) and Meta Platforms (META) both recently initiated quarterly dividends of $.40 and $.50 per share respectively. (Disclosure: I own CRM personally)
Now, a company graduating into an income play could have you dozing off, thinking their best days are behind them…but you’d be incredibly wrong.
As I’ll show you, these 2 technology stocks are screaming buys even at all-time highs.
To prove it, let’s review history.
Since 1973, companies that initiate and grow their dividend, handsomely outperform non-payers:
Though I believe there’s potentially an even bigger runway for these outlier stocks for years to come.
Here’s why.
I went back and studied 15 notable dividend initiations from some of the biggest names ever. To be fair, this list has some bias to it.
To cull together this list, I made the assumption that at the time of their first dividend announcement, it was reasonable to assume the companies would be in business 10 years later…exactly how I feel about Salesforce and Meta today.
High-quality companies that initiate dividends sport some of the best returns you’ll find.
Companies on this list include Microsoft, Home Depot, Walmart, Apple, Starbucks and more. Keep in mind this list covers initial dividends from the ‘70s, ‘80s, ‘90s, and 2000s.
A year after these firms paid their first dividend:
- A year later they gained an average of +51%
- 2-years later they nearly doubled at with a +93.9% rally
- 3-years after, the stocks saw mind-numbing returns of +142.9%!
(Disclosure: I personally own MSFT, HD, WMT, SBUX, COST, NKE, & CRM)
Folks, dividends are important. BUT, outlier stocks paying dividends are some of the most bullish signals you’ll find.
Couple that with our most important power signal, our Top 20 report… and it’s like you’re holding aces at the Hold’em poker table.
Salesforce has appeared on this rare list 14 times the past year:
When you study the evidence…these 2 technology stocks are screaming buys at all-time highs.
Let’s wrap up.
Here’s the bottom line: Consistent inflows in technology behemoths keep indices climbing higher and higher.
2 notable companies benefiting from this tidal wave of capital are Meta and Salesforce…tickers we know very well in our research. All year they’ve been profiled as top stocks numerous times.
Couple that with recent dividend initiations, and you’re staring at huge potential gains in the years to come.
Sometimes, waiting for a pullback is warranted for the market as a whole. But don’t lose sight of the bigger opportunity.
When you zero in on the best stocks in the world, morphing into income plays…you’re hunting for big-game returns.
That’s the holy grail of investing.
Author: Lucas Downey