3 Dividend Tech Stocks That Are Screaming Buys in March

Core Viewpoint - In a market characterized by high valuations, Verizon, IBM, and Cisco are identified as attractive income-generating investments due to their lower valuations and healthy dividend yields [1][2]. Group 1: Verizon - Verizon's stock reached a 13-year low of $28.25 on October 13, 2023, but has since rebounded to nearly$44 [3]. - The company doubled its annual postpaid phone net additions in 2024, driven by localized marketing, customizable plans, and growth in its distribution business with Walmart [4]. - Verizon's free cash flow rose 6% to $19.8 billion, covering its$11.2 billion in dividend payments, with a forward yield of 6.3% and a low forward price-to-earnings ratio of 9 [5]. Group 2: IBM - Under CEO Arvind Krishna, IBM has shifted focus towards cloud-based services and AI, spinning off its slow-growth IT infrastructure services business [6][7]. - From 2020 to 2024, IBM's revenue and EPS grew at compound annual growth rates of 3% and 1%, respectively, marking a recovery after years of decline [8]. - Analysts project a 4% growth in revenue and EPS for IBM this year, with a forward dividend yield of 2.7% and a payout ratio of 52% of its free cash flow [9]. Group 3: Cisco - Cisco faced challenges in fiscal 2021 and 2022 due to supply chain constraints but saw growth in fiscal 2023 as these issues were resolved [10][11]. - Analysts expect Cisco's revenue to rise 5% in fiscal 2025 as inventory issues are addressed, although adjusted EPS may remain flat due to integration costs from its acquisition of Splunk [12]. - Cisco's stock is valued at 17 times forward earnings, with a forward dividend yield of 2.6%, and it spent only half of its free cash flow on dividends over the past year [13].