Apple’s dividend yield is just 2%, or nearly 50 basis points below 10-year Treasuries. However, the companies recent positive dividend actions and fortress-like balance sheet imply the California-based company can be a dividend growth force in the years ahead.
The company reinstituted a dividend in 2012 at 37.8 cents per quarter and that number has since grown to 47 cents a quarter. Due to the fact that Apple does not yet have a lengthy track record of dividend increases, the stock is barred from inclusion in popular dividend ETFs such as the Vanguard Dividend Appreciation ETF (NYSEArca: VIG), tracks stocks that have raised their dividends for at least 10 consecutive years.
That has not stopped Apple from becoming a marquee holding in some dividend ETFs. In addition to VYM, Apple is the third-largest holding at a weight of 8.2% in the First Trust NASDAQ Technology Dividend Index Fund (NasdaqGM: TDIV). [Rise of Tech Dividends Helps ETFs]
Three WisdomTree dividend ETFs – the WisdomTree LargeCap Dividend Fund (NYSEArca: DLN), WisdomTree Total Dividend Fund (NYSEArca: DTD) and the WisdomTree U.S. Dividend Growth Fund (NasdaqGS: DGRW) – feature Apple as no lower than the second-largest holding.
Technology Select Sector SPDR
Tom Lydon’s clients own shares of Apple and QQQ. Todd Shriber owns shares of DGRW.