Most people think of Broadcom as an artificial intelligence chip play. And fair enough — the company just reported record Q1 2026 revenue of $19.3 billion, with AI semiconductor revenue nearly doubling year over year.
But there’s a quieter story that income investors have been benefiting from for years. Broadcom (AVGO) is also one of the most rewarding dividend stocks in the market, especially if you had the foresight to buy early.
“A steady, dependable dividend stream can provide nice ballast to a portfolio’s return,” Fidelity shared.
Broadcom’s history makes that case better than almost any other tech stock around.
AVGO is a rare dividend stock in tech
Most technology companies don’t pay dividends at all. They pour their cash into research, buybacks, or acquisitions. Broadcom is different.
Broadcom has increased its dividend for 14 consecutive years, a streak that began when the company initiated its dividend back in 2011.
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That kind of consistency is rare in any sector, let alone semiconductors.
Today, Broadcom pays an annual dividend of $2.60 per share. The current yield sits around 0.70% — modest on the surface. But for early investors, the real story is very different.
What a 2016 investment looks like today
Here’s where the math gets interesting. Back in 2016, AVGO stock traded at roughly $15.60 each.
So a $1,000 investment would have bought you about 64 shares. At the time, the annualized dividend was just $0.20 per share.
Those 64 shares would have generated around $12.80 in annual dividends, a yield of about 1.3%, which is not too attractive.
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Today, the annual dividend is $2.60 per share. Those same 64 shares now generate roughly $166. in annual dividend income.
That’s a yield-on-cost of approximately 16.6% on a $1,000 original investment. You haven’t bought a single additional share, while the dividend growth did the work.
This is exactly why income investors prize dividend growers over high-yielders. A stock yielding 5% today and never raising its payout will always yield 5% on your cost. A stock yielding 1% but doubling its dividend every five years can eventually dwarf it.
AVGO dividend stock: key metrics at a glance
Here are the most important dividend figures for Broadcom investors right now.
- Annual dividend per share: $2.60
- Quarterly dividend per share: $0.65
- Current dividend yield: About 0.70%
- 10-year dividend growth rate: Approximately 30% annually over the past decade
- Consecutive years of dividend increases: 14 years
- Payout ratio: Approximately 25%
- Dividend payment frequency: Quarterly
That payout ratio deserves attention. At under 30%, Broadcom retains most of its free cash flow, leaving plenty of room to keep raising the dividend without stretching its finances.
The AI engine fueling future dividend growth
A dividend is only as reliable as the business behind it. And right now, Broadcom’s business is accelerating sharply.
- In its fiscal Q1 2026 earnings call, CEO Hock Tan reported that AI semiconductor revenue hit $8.4 billion, up 106% year over year.
- The company then guided to $10.7 billion in AI revenue for Q2, representing 140% year-on-year growth.
- Total Q2 revenue guidance came in at $22 billion.
Tan also said Broadcom now has “line of sight” to AI chip revenue exceeding $100 billion in 2027.
The company has six major AI accelerator customers, including Google, Anthropic, Meta, and now OpenAI, all on multi-year, strategic partnerships.
That kind of revenue growth generates the free cash flow that enables dividend increases. In Q1 of fiscal 2026, free cash flow hit $8 billion.
Broadcom also returned $10.9 billion to shareholders in Q1 through dividends and share repurchases — and authorized a new $10 billion buyback program through the end of calendar 2026.
Wall Street is still bullish on this dividend stock
The income story isn’t the only reason analysts like AVGO.
J.P. Morgan has named Broadcom its top pick in the semiconductor sector, according to MarketWatch, projecting $55 billion to $60 billion in AI-related revenue for fiscal 2026.
Morgan Stanley recently raised its price target on AVGO stock to $470 from $462, maintaining its overweight rating, Insider Monkey noted.
The 31 analysts covering Broadcom stock carry a consensus “strong buy” rating, with an average price target of $464 — implying roughly 25% upside from current levels.
For income investors, that’s a compelling combination: a dividend stock growing its payout at double-digit rates annually, backed by a business that Wall Street still sees as significantly undervalued.
The numbers suggest that the investors who bought AVGO back in 2016 for its growth potential ended up with something they may not have fully anticipated: a tech stock that quietly became one of the market’s best dividend growers.
Related: $1,000 of AVGO stock from 2016 is worth this much with dividends
