Life of passive income? This stock of artificial intelligence (AI) has just increased its dividend 15%, with a lot of space for growth.

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When you are young, your investment goals revolve around growth. In retirement, these goals are changed to revenue. But if, for example, a decade or two of the retirement, your priorities are balanced between the two.

Therefore, the decades that led to retirement is a great time to buy a dividend growth stock. If the company is profitable and has a way up to a decade or more growth ahead, complex dividends payments can become quite large after you hit the age of retirement.

The catch is that dividend growth shares often have current yields that do not have exactly investors. However, the recent withdrawal on the market has significantly increased the yields of some companies, just because of their stocks. Because of this, the next company looked like the ultimate retirement stock for gene X and Millennial Investiters today.

Semiconductor supplies They were long -term winners on the stock market, although investors must be selective. The happiness of chip designers can change dramatically if and when a major technological change occurs and competition occurs. In the meantime, the production of chips can be quite intense, limiting the amount that companies can return to shareholders.

But the supplies of semiconductor equipment – companies that make the machines that produce chips – have a lower risk of chip designers and lower capital intensity from the foundry. “Semicap” equipment providers usually grow along with the semiconductor industry, which should be significantly above GDP in the long run. In the meantime, this subsector is also very concentrated on just a few big players with high margins and cash flows.

Materials applied (NASDAQ: AMAT) is the most prominent of the equipment suppliers and has just announced a large program of hikes and buying stakes in dividends. However, the stock was also reduced by some 40% of its maximum last summer, and the current dividend yield increased above 1%. With the years of growth that has been foreseen by AI, the section is a good case that investors in dividend growth can increase stocks today.

Last Monday, Applied announced that he would increase his quarterly dividend from 0.40 to $ 0.46 per share, an increase of 15%, which will be made on June 12 with recorders from the 22th of 22. In addition, the Applied Board of Directors approved a new $ 10 billion buyout program, except $ 7.6 billion, which remained already.

It is a big trip to the shareholder’s payment, although the enthusiasm of the administration disagrees with current feelings on the market. In fact, Appoyled shares decrease by about 40% compared to the highlight in July 2024. This is a fairly serious fall, especially since it is still applied to a consistently good number. In the last quarter, the company increased the 7% revenue and adjusted the non-gaap earnings per share by 12%. And analysts design nearly 10% earning growth during each of the next two years.

Increasing dividends that coincides with the fall in the price of APPYED shares has increased its yield to forward to about 1.25%, which is the highest yield at some time. Usually, when Applied’s dividend yield is in this way, it was usually time to buy shares (note: dividend yield below is not taken into account by a recent increase.)

Amat data Ycharts

Moreover, this dividend yield is very well covered with earnings. In a fiscal 2024, Applied Early earned $ 8.65 per share, covering new dividends of $ 1.84 4.7 times.

Not only that, but Wall Street expects to see the growth of earnings for the next two years, with an average EPS estimate of $ 9.37 this year and $ 10.11 in a Fiscal $ 2026.

Applied has a strong position in the furniture for jet and precipitation, which is important for the production of today’s state-of-the-art logical chips, as well as high-performance drama. AS The revolution takes a lot and a lot of both, which should enhance the growth of Appied in the medium -sized and its dividend along with it.

In addition, Applied makes metrological equipment that tests all types of chips and equipment for the implantation of ions used in the production of chips for backward and marginal energy for automatic and industrial end markets.

With a variety of portfolio and strong services, an applied prospect of profitable growth together with the chip industry, and as long as it reduces the number of stakes through the purchase of shares. This is a recipe for dividend growth significantly above the inflation rate for many years. Looking at the current volatility and from 10 to 20 years, applied “Payment could become significant.

Have you ever felt like you missed the ship in buying the most successful stocks? Then you will want to hear it.

On rare occasions, our expert team of analyst issues “Double” supplies Recommendation to companies they think will appear soon. If you are worried that you have already missed the opportunity to invest, now is the best time to buy before it is too late. And numbers speak for themselves:

Nvidia: If you invested $ 1,000 when we doubled in 2009, you would have $ 315,521!*
Apple: If you invested $ 1,000 when we doubled in 2008, You would have $ 40,476!*
Netflix: If you invested $ 1,000 when we doubled in 2004, you would have $ 495,070!*

We are currently releasing “double down” warnings for three incredible companies, and maybe there will be no other chance like this.

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*Stock Advisor returns from March 14, 2025

Billy Durestein and/or its clients have positions in applied materials. Motley Fool has positions and recommends applied materials. Motley Fool has disclosure rules.

Life of passive income? This stock of artificial intelligence (AI) has just increased its dividend 15%, with a lot of space for growth. originally published by Motley Fool

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