Broadcom (Nasdaq: AVGO) sells a wide variety of technology products, including switches and routers, and software to manage cybersecurity and payment security.

Though the company reinvented itself recently with its acquisition of software company Symantec, Broadcom is a part of the old guard when it comes to Silicon Valley tech companies.

The company has been around for more than 50 years. So it’s no surprise that, while still innovative, it generates plenty of earnings and cash flow and pays a dividend as a result.

And it pays a nice dividend, particularly for a technology company. With a $3.25 per share quarterly payout, Broadcom’s yield comes out to 3.5%.

Can this high-tech giant continue to reward shareholders with $3.25 in cash per quarter?

Loads of Free Cash Flow

Free cash flow is rising even during this pandemic year and is projected to do so again in 2021.

Last year, while generating $9.3 billion in free cash flow, Broadcom paid shareholders $4.2 billion in dividends.

This year, free cash flow is forecast to rise to $10.9 billion while Broadcom pays out $5.3 billion in dividends.

That’s a payout ratio below 50%, which gives me a lot of confidence in the company’s ability to continue to pay dividends – even if free cash flow drops next year.

Fortunately, that shouldn’t be the case, as free cash flow is forecast to rise to $11.8 billion.

Broadcom has a solid dividend-paying history. It has raised its payout to shareholders every year for 10 years.

Broadcom’s free cash flow has steadily increased over the years and is expected to grow further, its payout ratio is low, and it has a track record of raising its dividend every year.

Mature tech companies are often secure dividend payers, and Broadcom is no different.

Dividend Safety Rating: A