Our first idea today is an undervalued tech company that has a current dividend yield of 2.90%, paid quarterly. Our second recommendation is the sale of a previous pick.
Buy: Intel Corporation (INTC)
From Forbes Dividend Investor
Shares of Intel are down 17% since the Santa Clara, California, company reported earnings on October 22. Although sales and profits topped estimates, results showed weakness in the data center segment. Valuations already reflect a slowdown, with the stock trading at 9.6 times expected next 12 months of earnings, 22% below Intel’s five-year average forward P/E of 12.6. The stock also trades 28% below its five-year average price-to-sales ratio. The boss is betting that the stock is cheap. CEO Bob Swan scooped up 8,000 shares of Intel on Wednesday at $44.96 apiece. In addition, even in an industry with significant capital spending requirements, Intel over the past year has generated free cash flow of $4.73 per share, well in excess of $1.32 in annual dividends. You don’t have long to wait for the next one. The ex-dividend date is this Thursday, November 5, for a $0.33 per share payout.
John Dobosz, Forbes Dividend Investor, newsletters.forbes.com, 212-367-3388, October 31, 2020