Are Semiconductors Set To Pivot? Check Out 2 Chip Stocks Offering High Dividend Yields

Zinger Key Points
  • The iShares Semiconductor ETF is down roughly 39% year-to-date.
  • Since 2004, Texas Instruments dividends have grown at a 25% compounded annual growth rate.
Are Semiconductors Set To Pivot? Check Out 2 Chip Stocks Offering High Dividend Yields

With the iShares Semiconductor ETF SOXX down roughly 39% year-to-date, now may be the opportune time to open a position in the semiconductor industry. Semiconductors are used in a range of products from smartphones and computers to home appliances and cars.

As the global economy is experiencing a semiconductor shortage, automakers such as Ford Motor F and General Motors GM are storing trucks on inventory lots while they await their chips. Although the macroeconomic headwinds of a potential recession may send a shock to the semiconductor industry as the demand for electronics and automobiles declines.

Also Read: Intel Unit Mobileye's Proposed IPO: What You Need To Know

Intel Corporation INTC is offering a dividend yield of 5.50% or $1.46 per share annually, through quarterly payments, with a notable track record of increasing its dividends for seven consecutive years. Intel designs and manufactures microprocessors for the global personal computer and data center markets and is the world's largest logic chipmaker.

In the second quarter of 2022, Intel’s Israeli autonomous vehicle technology spinoff company Mobileye saw revenues of $460 million, up 41% from the prior year's second quarter.

Texas Instrument Inc. TXN is offering a dividend yield of 3.13% or $4.96 per share annually, utilizing quarterly payments, with a strong track record of increasing its dividends for 18 consecutive years. Since 2004, Texas Instruments dividends have grown at a 25% compounded annual growth rate.

Texas Instruments generates over 95% of its revenue from semiconductors and the remainder from its well-known calculators. The Dallas-based firm is the world's largest maker of analog chips, which are used to process real-world signals such as sound and power.

From 2004 through 2021, Texas Instruments reduced its shares outstanding by 46%, and on Sept. 15, the firm's board of directors authorized the company to repurchase an additional $15 billion of its common stock over time.

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