AVGO vs QCOM: Dividend Yield, Growth & Safety Comparison
Broadcom Inc. (AVGO) and Qualcomm Inc/De (QCOM) are both in the Information Technology sector, making them natural rivals for dividend investors. QCOM offers a significantly higher 2.51% yield compared to AVGO's 0.71%, a gap of 1.80%. For dividend growth, AVGO leads with a 5-year CAGR of 12.9% versus QCOM's 7.0%. AVGO holds the edge in dividend safety with a "Safe" rating. AVGO is a Dividend Challenger while QCOM is a Dividend Contender.
Key Metrics Comparison
| Metric | AVGO | QCOM |
|---|
| Dividend Yield | 0.71% | 2.51% |
| Annual Dividend | $2.42 | $3.52 |
| 5-Year CAGR | 12.9% | 7.0% |
| Payout Ratio | 49% | 71% |
| Consecutive Years | 6 | 23 |
| Price | $327.48 | $140.78 |
Yield Comparison
Qualcomm Inc/De (QCOM) currently yields 2.51%, which is solid for the broader market. That's 1.80% more than Broadcom Inc. (AVGO), which yields 0.71%. In dollar terms, QCOM pays $3.52/share annually versus AVGO's $2.42/share.
Dividend Growth
Over the past five years, AVGO has grown its dividend at a 12.9% CAGR compared to QCOM's 7.0%. AVGO: Dividend growth has been steady, with a 3-year CAGR of 12.7% and a 5-year CAGR of 12.9% (10-year: 28.6%). QCOM: Dividend growth is slowing — the 3-year CAGR of 5.7% trails the 5-year rate of 7.0% and the 10-year rate of 6.1%.
Dividend Safety
AVGO's dividend safety is rated "Safe." The payout ratio of 49% is well within sustainable levels, leaving room for future increases. Earnings cover the dividend 2.0x. QCOM's dividend safety is rated "Moderate." The payout ratio of 71% is moderate. The dividend is currently covered by earnings but leaves less room for growth. Earnings cover the dividend 1.4x. AVGO's payout ratio of 49% is more conservative than QCOM's 71%, suggesting more room for future increases.
Income Comparison
A $10,000 investment in QCOM generates approximately $251/year in dividend income, compared to $71/year from AVGO — a difference of $180/year. At $100,000, that gap widens to $1800/year.
Verdict
- Best for income: QCOM
- Best for growth: AVGO
- Best for safety: AVGO
Frequently Asked Questions
Which has a higher dividend yield, AVGO or QCOM?
Qualcomm Inc/De (QCOM) has a higher dividend yield of 2.51% compared to Broadcom Inc. (AVGO) at 0.71%.
Is AVGO or QCOM a better dividend growth stock?
Broadcom Inc. has the stronger dividend growth with a 5-year CAGR of 12.9%, compared to Qualcomm Inc/De's 7.0%.
Which is safer for dividend income, AVGO or QCOM?
Broadcom Inc.'s dividend safety is rated "Safe" while Qualcomm Inc/De is rated "Moderate." The payout ratio of 49% is well within sustainable levels, leaving room for future increases. Earnings cover the dividend 2.0x. The payout ratio of 71% is moderate. The dividend is currently covered by earnings but leaves less room for growth. Earnings cover the dividend 1.4x.
How much income does $10,000 in AVGO vs QCOM generate?
A $10,000 investment in AVGO generates approximately $71/year in dividends, while the same amount in QCOM generates about $251/year.
Is AVGO or QCOM a Dividend Aristocrat?
Broadcom Inc. is a Dividend Challenger (6 years) and Qualcomm Inc/De is a Dividend Contender (23 years).
Which has a lower payout ratio, AVGO or QCOM?
Broadcom Inc. has a lower payout ratio of 49% compared to Qualcomm Inc/De's 71%. A lower payout ratio generally indicates more room for dividend growth and better sustainability.
AVGO vs QCOM: which is better for retirement income?
It depends on your priorities. QCOM for current income, AVGO for dividend growth, AVGO for safety. Many retirement investors hold both for diversification.
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