Dividend.com analyzes the search patterns of our visitors each week. By sharing these trends with our readers, we hope to provide insights into what the financial world is concerned about and how to position your portfolio.
Technology giant Microsoft has taken first position in the list this week, after the company raised its dividend. Second in the list is real estate company VICI Properties, which also raised its dividend. Third is AT&T, the struggling telecom giant that has seen some recent good news. Last in the list is agency mortgage-backed security REIT Annaly Capital, which declared its regular dividend.
Don’t forget to read our previous edition of trends here.
Microsoft Raises Dividend
Microsoft Corporation (MSFT) has placed first in the list this week, with an increase in viewership of 50%. Microsoft attracted readers’ interest after it raised its quarterly dividend by 10% from 75 cents per share to 83 cents. The dividend still yields a small 0.7% annually, but the tech giant has compensated investors with strong stock price performance.
Shares in Microsoft are up 35% over the past 12 months, as the company continued to post impressive performance on the back of its strong growth of cloud. The company has also been an artificial intelligence (AI) leader, being among one of the first companies to launch generative AI products like Copilot.
The dividend increase comes despite Microsoft ramping up capital expenditures to build new data centers filled with GPUs, amid a race with other cloud hyperscalers to grab market share in the nascent GenAI market segment. For the latest fiscal year ended June 30, Microsoft spent $55.7 billion on capital expenditures, 75% more than in the previous year, and capex is only expected to increase in the coming years.
Source: Barchart
VICI Properties Hikes Shareholder Payout
Real estate owner VICI Properties (VICI) has taken the second position in the list with an advance in traffic of 34%. VICI, which owns and operates real estate for gaming and entertainment destinations like Caesars Palace Las Vegas, has increased its dividend by 4.2% to a quarterly 43 cents.
In addition to the dividend growth, VICI has rewarded investors with strong stock price performance as its operational performance has been strong. Funds from operations in the second quarter came in at $741 million compared with $690 million during the same quarter last year.
This year, the company has continued to invest in its properties, providing $700 million of capital to The Venetian Resort Las Vegas.
Gambling has been growing at a rapid clip in the U.S. in recent years, with VICI expected to be one of the key beneficiaries of this trend.
Source: Barchart
AT&T Stock Boosted Following Report of DirecTV-DISH Merger
AT&T (T) is third in the list, seeing an increase in traffic of 31% in the past fortnight.
AT&T, the indebted telecom giant, has seen its shares rise after a report that it is in discussions to merge subsidiary DirecTV with competitor DISH Network, which is owned by Echostar. The two companies already tried to merge about 22 years ago, but the deal was struck down by antitrust regulators. Now, however, the deal has a greater chance of being approved given that the landscape has significantly changed with the entrance of many players like Netflix, Amazon and Apple.
A potential deal will allow AT&T to focus fully on its wireless and internet services. Proceeds from the potential sale of its 70% stake will help it decrease debt and free up cash for infrastructure investments and shareholder returns. AT&T cut its dividend in half in mid-2022 and has not made any changes since then. The 27.75 cents quarterly dividend still yields an impressive 5.2%. However, AT&T’s operational performance has disappointed lately.
Source: Barchart
Annaly Capital Likely to Benefit From Lower Interest Rates
Annaly Capital (NLY) has placed last with an increase in traffic of 23%.
Annaly, a mortgage real estate investment trust, has a dividend that yields more than 12.6%. The company cut the dividend from 88 cents per quarter to 65 cents at the end of 2022, as higher interest rates have hit the company’s performance. As the Federal Reserve lowered the interest rates, Annaly might benefit in the future, but the near term remains unclear.
Annaly Capital shares are up nearly 7% so far this year.
Source: Barchart
The Bottom Line
Microsoft has raised its dividend as the company’s results have been strong lately. VICI Properties has also raised its dividend, as the company’s funds from operations have shot up in recent quarters. AT&T stock has been boosted by potential news that it could finally sell its stake in DirecTV if the company merges with DISH Network. Last in the list is Annaly Capital, which might benefit from falling interest rates.
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