AVGO Dividend Yield Pushes Above 2%

Looking at the universe of stocks we cover at Dividend Channel, in trading on Wednesday, shares of Avago Technologies Ltd (AVGO) were yielding above the 2% mark based on its quarterly dividend (annualized to $0.92), with the stock changing hands as low as $44.71 on the day. Dividends are particularly important for investors to consider, because historically speaking dividends have provided a considerable share of the stock market's total return. To illustrate, suppose for example you purchased shares of the iShares Russell 3000 ETF (IWV) back on 5/31/2000 — you would have paid $78.27 per share. Fast forward to 5/31/2012 and each share was worth $77.79 on that date, a loss of $0.48 or 0.6% decrease over twelve years. But now consider that you collected a whopping $10.77 per share in dividends over the same period, increasing your return to 13.15%. Even with dividends reinvested, that only amounts to an average annual total return of about 1.0%; so by comparison collecting a yield above 2% would appear considerably attractive if that yield is sustainable. Avago Technologies Ltd (AVGO) is a member of the Russell 3000, giving it special status as one of the largest 3000 companies on the U.S. stock markets.

In general, dividend amounts are not always predictable and tend to follow the ups and downs of profitability at each company. In the case of Avago Technologies Ltd, looking at the history chart for AVGO below can help in judging whether the most recent dividend is likely to continue, and in turn whether it is a reasonable expectation to expect a 2% annual yield.

START SLIDESHOW:
Click here to find out which 9 other dividend stocks just recently went on sale »

AVGO+Dividend+History+Chart

According to the ETF Finder at ETF Channel, AVGO makes up 3.43% of the iShares PHLX Semiconductor ETF ( SOXX) which is trading lower by about 3.3% on the day Wednesday.

null

More from Stocks

Coke's a Better Stock to Buy Than Pepsi on Surprising North America Sales
Amazon Crushes Quarterly Earnings Estimates, Raises the Price of Prime

Amazon Crushes Quarterly Earnings Estimates, Raises the Price of Prime

Barbie Flexes Her Muscle in Mattel's Q1 Earnings

Barbie Flexes Her Muscle in Mattel's Q1 Earnings

Amazon Crushes First-Quarter Profit Estimates -- Watch TheStreet's Live Analysis

Amazon Crushes First-Quarter Profit Estimates -- Watch TheStreet's Live Analysis

Dow Jumps 238 Points as S&P 500, Nasdaq Also Climb

Dow Jumps 238 Points as S&P 500, Nasdaq Also Climb