Is QUALCOMM Incorporated (QCOM) the Best NASDAQ Dividend Stock to Buy?

QCOM Dividend History

Qualcomm Incorporated (QCOM) has been a popular choice among income-oriented investors due to its consistent dividend growth and attractive yield. As of January 15, 2025, QCOM offers a quarterly dividend of $0.85 per share, resulting in an annualized dividend of $3.35 per share. This translates to a dividend yield of 2.19%, which is higher than the Technology sector average of 1.76% and the industry average. QCOM's dividend yield is also 24% higher than the Technology sector average, making it an attractive option for investors seeking high dividend yields in the technology sector.

Table showing QCOM's dividend history, including ex-dividend dates, dividend amounts, and dividend yields.

QCOM's dividend growth history is another key factor that sets it apart from its peers. The company has increased its dividend for 22 consecutive years, demonstrating a strong commitment to returning capital to shareholders. This consistency is a significant factor in attracting income-oriented investors. In comparison, other NASDAQ-listed dividend stocks such as Texas Instruments Inc (TXN), Cisco Systems Inc (CSCO), Juniper Networks Inc (JNPR), Motorola Solutions Inc (MSI), and Nvidia Corp (NVDA) have increased their dividends for 18, 10, 11, 10, and 10 consecutive years, respectively.

QCOM Dividend Payout Ratio

QCOM's dividend payout ratio is another important metric to consider when evaluating its dividend sustainability. As of January 15, 2025, QCOM has a payout ratio of 36.9%, which is lower than the Technology sector average of 38.7%. This indicates that QCOM is not overpaying its dividend relative to its earnings, suggesting that its dividend is sustainable and can be maintained or increased in the future.

Chart comparing QCOM's payout ratio to the Technology sector average and its peers.

QCOM's strong financial performance is another factor that contributes to its dividend growth prospects. In fiscal Q4 2024, QCOM reported impressive earnings, with revenues reaching $10.24 billion, marking an 18% increase compared to the same quarter the previous year. Net income surged 33% year-over-year to $3.5 billion. Additionally, the company achieved annual earnings per share growth of over 30% for fiscal 2024.

QCOM Dividend Growth Prospects

The expected growth in AI and 5G technologies is set to have a positive impact on QCOM's future dividend growth. QCOM is well-positioned to capitalize on the rapidly expanding generative AI smartphone market, with IDC expecting sales of generative AI smartphones to jump by 73% in 2025. Additionally, QCOM's Snapdragon X Series CPUs are expected to drive growth in the AI PC market, which is projected to grow by 165% in 2025. As the market for AI PCs is expected to grow by 165% in 2025, QCOM's dividend growth could be significantly driven by this sector.

Chart showing the expected growth in AI and 5G technologies and its impact on QCOM's future dividend growth.

In conclusion, QCOM's strong dividend growth history, high dividend yield, low payout ratio, and solid financial performance make it an attractive option for income-oriented investors. The company's commitment to increasing its dividend payout, coupled with its strong financial performance and the expected growth in AI and 5G technologies, suggests that QCOM's dividend growth prospects are promising. While QCOM may not be the best NASDAQ dividend stock for every investor, its combination of dividend growth, yield, and sustainability makes it a strong contender in the technology sector.