QCOM vs TXN: Dividend Yield, Growth & Safety Comparison
Qualcomm Inc/De (QCOM) and Texas Instruments Inc (TXN) are both in the Information Technology sector, making them natural rivals for dividend investors. Both stocks offer similar yields — QCOM at 2.51% and TXN at 2.49%. For dividend growth, TXN leads with a 5-year CAGR of 14.6% versus QCOM's 7.0%. TXN holds the edge in dividend safety with a "Safe" rating. QCOM is a Dividend Contender with 23 years of consecutive increases.
Key Metrics Comparison
| Metric | QCOM | TXN |
|---|
| Dividend Yield | 2.51% | 2.49% |
| Annual Dividend | $3.52 | $5.50 |
| 5-Year CAGR | 7.0% | 14.6% |
| Payout Ratio | 71% | 1% |
| Consecutive Years | 23 | 0 |
| Price | $140.78 | $226.09 |
Yield Comparison
Qualcomm Inc/De (QCOM) currently yields 2.51%, which is solid for the broader market. Texas Instruments Inc (TXN) yields a nearly identical 2.49%. In dollar terms, QCOM pays $3.52/share annually versus TXN's $5.50/share.
Dividend Growth
Over the past five years, TXN has grown its dividend at a 14.6% CAGR compared to QCOM's 7.0%. 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%. TXN: Dividend growth is accelerating — the 3-year CAGR of 20.6% exceeds the 5-year rate of 14.6% and the 10-year rate of 17.8%.
Dividend Safety
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. TXN's dividend safety is rated "Safe." The payout ratio of 1% is well within sustainable levels, leaving room for future increases. Earnings cover the dividend 1.0x. TXN's payout ratio of 1% 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 $249/year from TXN — a difference of $2/year. At $100,000, that gap widens to $20/year.
Verdict
- Best for growth: TXN
- Best for safety: TXN
Frequently Asked Questions
Which has a higher dividend yield, QCOM or TXN?
Qualcomm Inc/De (QCOM) has a higher dividend yield of 2.51% compared to Texas Instruments Inc (TXN) at 2.49%.
Is QCOM or TXN a better dividend growth stock?
Texas Instruments Inc has the stronger dividend growth with a 5-year CAGR of 14.6%, compared to Qualcomm Inc/De's 7.0%.
Which is safer for dividend income, QCOM or TXN?
Qualcomm Inc/De's dividend safety is rated "Moderate" while Texas Instruments Inc is rated "Safe." 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. The payout ratio of 1% is well within sustainable levels, leaving room for future increases. Earnings cover the dividend 1.0x.
How much income does $10,000 in QCOM vs TXN generate?
A $10,000 investment in QCOM generates approximately $251/year in dividends, while the same amount in TXN generates about $249/year.
Is QCOM or TXN a Dividend Aristocrat?
Qualcomm Inc/De is a Dividend Contender with 23 consecutive years of increases. Texas Instruments Inc does not currently qualify for aristocrat status.
Which has a lower payout ratio, QCOM or TXN?
Texas Instruments Inc has a lower payout ratio of 1% compared to Qualcomm Inc/De's 71%. A lower payout ratio generally indicates more room for dividend growth and better sustainability.
QCOM vs TXN: which is better for retirement income?
It depends on your priorities. TXN for dividend growth, TXN for safety. Many retirement investors hold both for diversification.
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