The technology sector is one of the important economic sectors in the US, comprising some of the biggest companies engaged in electronics, software, computer, AI, and other IT-related areas. It was one of the best performing sectors last year, as demands soared during the pandemic.
However, the rally was cut short amid record-high inflation, Fed’s interest rate hikes, supply-chain hurdles, and other adverse macroeconomic and geopolitical factors. But given the sector’s tremendous growth potential, investors may find it hard to ignore the technology companies. Here we explore some top dividend-paying S&P 500 information technology stocks to watch in Q3.
International Business Machines Corporation (NYSE: IBM)
International Business Machines Corp is one of the leading technology firms offering cloud and software services to clients. The company is based in Armonk, New York.
Its shares traded at US$140.83 at 1:07 pm ET on July 7, up 1.99% from their previous close. The stock gained 1.5% YTD. IBM has a market cap of US$126.67 billion, a P/E ratio of 23.13, and a forward one-year P/E ratio of 13.96. Its current yield is 4.8%, and its annualized dividend is US$6.60.
The 52-week highest and lowest stock prices were US$146.00 and US$114.56, respectively. Its trading volume was 3,237,059 on July 6.
The company reported a revenue of US$14.2 billion in Q1, FY22, representing an increase of 8% YoY. Its net income was US$733 million, compared to US$955 million in Q1, FY21.
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Intel Corporation (NASDAQ: INTC)
Intel Corporation is one of the leading technology and semiconductor firms based in Santa Clara, California.
The stock traded at US$38.14 at 1:16 pm ET on July 7, up 3.11% from its previous closing price. INTC shares fell 30.48% YTD.
Its market cap is US$155.98 billion, the P/E ratio is 6.33, and the forward one-year P/E ratio is 10.63. Its current yield is 3.98%, and its annualized dividend is US$1.46.
The stock touched the highest price of US$57.45 and the lowest price of US$35.54 in the last 52 weeks. Its share volume on July 6 was 26,258,320.
The company will report its second-quarter fiscal 2022 results on July 28.
Meanwhile, in the first quarter of fiscal 2022, Intel’s revenue was US$18.35 billion, while its net income came in at US$8.11 billion.
Seagate Technology Holdings PLC (NASDAQ: STX)
The Cupertino, California-based Seagate provides electronic data storage technology and services.
The company’s shares traded at US$74.475 at 1:22 pm ET on July 7, up 4.12% from their closing price of July 6. Its stock value decreased by 36.79% YTD.
Seagate has a market cap of US$16.00 billion, a P/E ratio of 9.13, and a forward one-year P/E ratio of 9.08. Its current yield is 3.93%, and its annualized dividend is US$2.80.
The 52-week highest and lowest stock prices were US$117.67 and US$67.36, respectively. Its trading volume was 1,610,079 on July 6.
The company reported a revenue of US$2.80 billion in Q3, FY22, compared to US$2.73 billion in the year-ago quarter. Its net income was US$346 million, or US$1.56 per diluted share, against an income of US$329 million, or US$1.39 per diluted share, in Q3, FY21.
Hewlett Packard Enterprise Company (NYSE: HPE)
Hewlett Packard is an information technology firm based in Spring, Texas. It provides edge-to-cloud platform-as-a-service solutions to clients.
The stock traded at US$13.06 at 1:27 pm ET on July 7, up 2.27% from its previous closing price. HPE shares declined 20.88% YTD.
Hewlett Packard’s market cap is US$16.96 billion, the P/E ratio is 4.68, and the forward one-year P/E ratio is 10.55. Its current yield is 3.74%, and its annualized dividend is US$0.48.
The stock touched the highest price of US$17.76 and the lowest price of US$12.40 in the last 52 weeks. Its share volume on July 6 was 10,532,690.
The company’s revenue surged 0.2% YoY to US$6.71 billion in Q2, FY22. Its net earnings were US$250 million, or US$0.19 per diluted share, versus US$259 million, or US$0.19 per diluted share, in Q2, FY21.
Hewlett expects its third-quarter GAAP diluted EPS to be between US$0.22 and US$0.32.
Cisco Systems, Inc. (NASDAQ: CSCO)
Cisco designs technologies for networking, security, cloud, and other IT-related segments. It is based in San Jose, California.
The company’s shares traded at US$43.05 at 1:33 pm ET on July 7, up 0.84% from their closing price of July 6. Its stock value plunged 32.41% YTD.
The firm has a market cap of US$178.28 billion, a P/E ratio of 15.08, and a forward one-year P/E ratio of 14.23. Its current yield is 3.62%, and its annualized dividend is US$1.52.
The 52-week highest and lowest stock prices were US$64.28 and US$40.82, respectively. Its trading volume was 17,250,440 on July 6.
Cisco’s revenue was flat YoY to US$12.8 billion in Q3, FY22. Its GAAP net income came in at US$3 billion, or US$0.73 per diluted share, compared to US$2.9 billion, or US$0.68 per diluted share, in Q3, FY21.
Bottom line:
Technology stocks saw modest gains in July, with the second-quarter earnings season around the corner. The quarterly earnings are expected to provide cues on how these businesses may have managed the supply hurdles and other issues besides the progress in the overall economy.
The technology industry has been one of the worst-affected economic sectors this year. The S&P 500’s IT segment fell 25.51% YTD while decreasing 13.88% over the past 12 months. Hence, investors should evaluate the companies and the market scenario before investing in stocks.
