In 2022, chip stocks delivered a less-than-desired performance, with many headwinds negatively impacting businesses. However, these three reward their shareholders with dividends, providing a nice buffer to the volatility these stocks can experience.
When it comes to semiconductor stocks, investors tend to focus on growth, and the Rich Templeton era at Texas Instruments (TI) (NASDAQ: TXN) shows this well. Templeton, who became CEO in May 2004, grew the stock's value by more than 600% over his tenure. When Templeton took over TI, its annual dividend stood at only $0.089 per share, amounting to a return of less than 0.4%.
Texas Instruments' (NASDAQ: TXN) stock has stayed nearly flat over the past 12 months as the S&P 500 has declined 9%. TI outperformed the chip sector because it was broadly diversified, it didn't have much exposure to the PC market, and it generated most of its growth from the auto and industrial sectors. Its gross margins held steady because it mainly sold analog and embedded chips, which are cheaper to produce than higher-end chips, and it consistently reduced its production costs by transitioning from 200mm to 300mm wafers (which lowered the costs of its unpackaged parts by about 40%).