Besides the record-breaking stock price spike, another enticing aspect of semiconductor manufacturer Nvidia (NASDAQ: NVDA) is its ability to reward income-seeking investors through dividends.
In this line, today, September 12, 2024, marks the record date for the company’s upcoming dividend payout.
Notably, with a yield of 0.03% and an annual dividend of $0.04, Nvidia investors who owned the stock before the record date will be eligible for a $0.01 per share, payable on October 3, 2024. The dividend value has been adjusted to reflect the company’s ten-for-one stock split.
Nvidia historical dividend payout. Source: Nasdaq
Historical data shows that Nvidia has implemented a consistent payout pattern in recent quarters, ranging from $0.01 to $0.04 per share.
Compared to other tech giants, the current dividend is on the lower side, likely discouraging income-focused investors. However, it is essential to note that the low payout is due to Nvidia’s focus on growth and reinvesting in the business to drive expansion.
Nvidia’s appeal to investors
Indeed, Nvidia’s general appeal to investors is its consistent growth in recent months, capitalizing on the booming semiconductor and artificial intelligence (AI) sectors. For instance, this niche enabled the company to record year-over-year revenue growth of 122% to $30.04 billion, while net income surged 168% YoY to $16.6 billion during the second quarter of 2024.
Looking ahead, shareholders are likely to see more rewards, given the chipmaker’s anticipation of consistent demand growth, as highlighted by CEO Jensen Huang.
Interestringly, the executive noted that amid the growing demand, customers have concerns about whether the company can satisfactorily provide the chips. He described the situation as emotional, stating that Nvidia has no choice but to deliver.
For the third quarter, the company is targeting approximately $32.50 billion in revenue and an expected gross margin of 75%.
NVDA stock price analysis
Currently, Nvidia’s stock has reacted positively to the news of increasing demand, trading at $119 at press time, gaining almost 2% in 24 hours. This development has helped the stock recover from the bearish sentiment in early September, gaining 14% on the weekly chart.
Nvidia YTD stock price chart. Source: Finbold
In summary, Nvidia has already established a consistent history of dividend payments, making it a viable option for income seekers. However, the dividend amount may vary in the future, depending on the company’s ability to maintain its leadership in the semiconductor space.
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