Everybody loves dividends, as they provide a passive income stream, limit drawdowns in other positions, and provide more than one way to profit from an investment.

Recently, several companies, including Taiwan Semiconductor Manufacturing (TSM) , PACCAR (PCAR) , and PepsiCo (PEP) , have announced a boost to their quarterly payouts. For those interested in income, let’s take a closer look at each.

Taiwan Semiconductor

TSM posted better-than-expected results in its latest release, exceeding the Zacks Consensus EPS estimate by nearly 7% and posting sales 2.7% ahead of expectations. Earnings grew 5% year-over-year, whereas revenue jumped 13% from the year-ago period.

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The company announced a 10% boost to its payout, bringing the quarterly total to $0.45/share. TSM’s commitment to increasingly rewarding shareholders has kept it a favorite among income-focused investors seeking technology exposure.

Shares currently yield 1.1% annually, nicely above the Zacks Computer & Technology sector average.

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TSM shares have been notable outperformers in 2024 on the back of the semiconductor trade, up nearly 50% and crushing the S&P 500.

PACCAR

PACCAR is a leading manufacturer of heavy-duty trucks worldwide, with substantial manufacturing exposure to light/medium trucks. The company recently announced an 11% boost to its payout, bringing the quarterly total to $0.30/share.

The earnings estimate revisions trend has been considerably bullish for its current fiscal year (FY24), up nearly 30% to $8.26 per share over the last year. Growth is expected to cool in FY24, with earnings forecasted to see a decline before resuming growth in FY25.

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The company’s quarterly results have consistently beat our expectations as of late, exceeding the Zacks Consensus EPS estimate by an average of 12% across its last four releases.

PepsiCo

PepsiCo, a current Zacks Rank #2 (Buy), manufactures, markets, and distributes grain-based snack foods, beverages, and other products. The company upped its quarterly payout by 7%, bringing the total to $1.35/share.

The company has long been a favorite among income-focused investors, holding the ranks of a Dividend Aristocrat.

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The earnings estimate revisions trend has been considerably bullish for its current fiscal year, up 3% to $8.17 per share over the last year and suggesting 7% year-over-year growth. Better-than-expected quarterly results have kept analysts positive, with the company exceeding the Zacks Consensus EPS estimate by an average of 5% across its last four releases.

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Image Source: Zacks Investment Research

Bottom Line

Targeting dividend-paying stocks is an excellent strategy that investors can deploy.

Dividends soften the blow from drawdowns in other positions, provide more than one way to reap a return from an investment, and allow maximum returns through dividend reinvestment.

And all three companies above – Taiwan Semiconductor Manufacturing (TSM Quick QuoteTSM - Free Report) , PACCAR (PCAR Quick QuotePCAR - Free Report) , and PepsiCo (PEP Quick QuotePEP - Free Report) – have recently boosted their payouts.

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