Broadcom Stock Yields Just 0.68%. But the Dividend Has Seen Explosive Growth

At archetypal glance, Broadcom (NASDAQ: AVGO) hardly looks similar a dividend stock. The spot and infrastructure bundle elephantine pays $2.60 per stock successful yearly dividends, and with the banal closing Friday astatine $381.92, that works retired to a dividend output of conscionable 0.68%. Put $10,000 into the banal today, and you cod astir $68 a year. Not excessively exciting.

But a existent output is conscionable a snapshot, and snapshots don't amusement motion. What the 0.68% hides is simply a dividend that has been raised for 15 consecutive years and has multiplied astir 13-fold implicit the past decade.

Missed Nvidia successful 2009? This Rare Signal Is Flashing Again. In 2009, a "Double Down" awesome flashed for a little-known chipmaker called Nvidia. For the archetypal clip successful years, that aforesaid "Total Conviction" awesome is flashing for a institution 1/100th the size of Nvidia. Continue »

While this dividend's astounding maturation isn't guaranteed to persist, it speaks to the prime of the underlying business.

From a nickel to $0.65

Ten years ago, Broadcom's quarterly dividend was $0.51 per share. Adjusted for the company's 10-for-1 banal divided successful 2024, that's astir a nickel. Today, the quarterly payout is $0.65. That's astir 13 times the split-adjusted level of mid-2016, which works retired to an annualized maturation complaint of astir 29%.

To beryllium fair, that decennary includes 1 exceptional leap. In December 2016, Broadcom's committee doubled the payout successful a azygous stroke.

The gait has settled down since. Over the past 5 years, the quarterly dividend has climbed from a split-adjusted $0.36 to $0.65, astir 12.5% annualized. The latest increase, announced successful December alongside the company's fiscal fourth-quarter results, was 10%.

Growth successful the 10% to 12% scope whitethorn dependable mean adjacent to that 29% figure. But it adds up. A dividend compounding astatine 12% doubles astir each six years -- and Broadcom has sustained double-digit increases portion pouring wealth into acquisitions and its artificial quality (AI) spot business.

The currency down the raises

A dividend is lone arsenic bully arsenic the currency travel covering it, truthful the archetypal happening I cheque is however easy the institution pays its bill.

In its fiscal 2nd 4th of 2026 (ended May 3, 2026), Broadcom generated $10.3 cardinal of escaped currency flow, an tremendous 46% of its $22.2 cardinal successful revenue. Dividend payments during the 4th came to $3.1 cardinal -- astir 30% of that escaped currency flow, leaving plentifulness behind. Indeed, Broadcom enactment different $600 cardinal into stock repurchases during the period.

Measured against earnings, the yearly dividend runs astatine astir 43% of the past year's net per share.