Technology has evolved from being an individual industry to something that touches virtually every business on Earth today. That means there are more technology-driven companies and stocks than ever and more variety for investors to consider.
You shouldn't assume that technology stocks are just for the risk-seeking adventurers anymore. Sure, there are still tech stocks for that investing class, but there are also plenty of profitable, blue-chip tech dividend stocks to consider as well.
Here are five technology stocks with the necessary ingredients to provide double-digit dividend growth for the foreseeable future. Consider buying and holding these in your diversified portfolio.
NASDAQ: MSFT
Key Data Points
1. Microsoft
Technology entered a new era when the internet was born, and Microsoft (MSFT +0.60%) has ridden that growth, blossoming into a tech juggernaut and one of the world's largest corporations. Its reach spans software, hardware, cloud, gaming, and other businesses that generate over $60 billion in annual cash flow.
The company has already shown a commitment to sharing its profits with investors. It's paid and raised its dividend for 21 consecutive years.
MSFT Dividend data by YCharts
The company's decades of growth have kept the dividend payout ratio under control at 32% of cash flow despite giving shareholders routine double-digit increases. Microsoft has deep roots throughout the technology space, including artificial intelligence. Therefore, investors can confidently hold the stock without losing sleep at night.
2. ASML
Artificial intelligence could grow for many years, which makes ASML (ASML +3.42%) a stock investors need to know about. The manufacturer dominates the market for extreme ultraviolet lithography (EUV) machines, which are crucial for making advanced semiconductors that provide critical computing power for AI models. In other words, if AI is a gold rush, ASML sells the proprietary tools to get the gold.
ASML Dividend data by YCharts
ASML is a European company that doesn't pay dividends as steadily as many American corporations. You can see above that the dividends ASML pays are volatile. They'll go up and down, but ASML will fill your pockets with cash over time. The dividend payout ratio is a modest 43%, and healthy long-term semiconductor demand due to AI and other technologies bodes well for ASML's shareholders to see dividend growth going forward.
NASDAQ: INTU
Key Data Points
3. Intuit
Companies often don't pay dividends until their business matures, which means financial software company Intuit (INTU +1.67%) could be getting warmed up for massive dividend growth. The company has raised its payout for 12 consecutive years, and its 21% payout ratio and mid-teens growth rate signal many more increases ahead.
INTU Dividend data by YCharts
Intuit owns software products like TurboTax, MailChimp, Quickbooks, and CreditKarma, so the business should continue raking in profits as long as people pay taxes, have credit scores in need of monitoring, or track their business expenses -- and people will probably do these things forever! That has Intuit looking like an upcoming dividend superstar.
4. Moody's
Data analytics company Moody's (MCO +1.62%) is another business that will probably be around for a very long time. After all, does anyone expect corporations and governments to stop borrowing money anytime soon? Moody's is one of the primary authorities in the corporate credit space, issuing ratings on debt, along with its peer, S&P Global. Moody's also sells software and tools for economic research.
MCO Dividend data by YCharts
Moody's authoritative reputation separates it from competitors and creates a durable business poised for solid dividend growth. As of today, the company has raised its dividend for 12 consecutive years. And a 31% payout ratio means that there's much more where that came from. Warren Buffett has owned Moody's via Berkshire Hathaway for nearly a quarter century, a vote of confidence for investors.
NYSE: V
Key Data Points
5. Visa
Quick, open your wallet. You'll probably find a debit or credit card with Visa's (V +0.61%) logo. Visa is the leading payment network in America, and potentially worldwide. Whenever you swipe a payment card, information flows on Visa's network between your bank and the merchant to verify funds, authorize the transaction, and move the money. Visa gets a small percentage of every transaction on its network, like a tollbooth operator.
V Dividend data by YCharts
Visa has become a cash cow, growing its business well enough to issue 20%-plus dividend raises and still have a payout ratio below 20%. As of today, the company's sporting a 15-year streak of consecutive increases, and Visa's financials make it easy to see that streak doubling or tripling from here. The starting yield is only 0.77%, but such big raises will multiply your dividend payments over a decade or two.
Looking for others? Consider this...
The recurring theme with these companies is that they dominate what they do. That means competition can't easily knock them down, and they have enough growth and pricing power to grow cash flow year in and year out.
Remember, dividends are cash expenses for the company, so if you find a company that can organically grow and share increasingly significant amounts of those profits with you -- well congrats, you've got yourself a true wealth-compounding machine.
