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The Semiconductor Stocks: Dividend Opportunities With a Side of Caution

If you had to describe the semiconductor sector in two words, it would have to be roller coaster. Like many industries, the COVID-19 crisis and pandemic has thrown the chip stocks for a loop over the last year or so. We’ve gone from oversupplies to shortages. We’ve had share prices surge and crash. And that volatility has even extended to strong, multi-line producers that have a long history of paying dividends.

Sadly, the trend is continuing so far into the new year.

First quarter earnings are starting to roll in and the results have been less than stellar. Big earnings misses, mixed guidance, and continued global pressures have caused many stocks in the sector to plunge in recent trading sessions. This is despite new market highs.

However, long-term and patient investors may want to ride out the volatility. Several trends propelling the sector are still intact and cash flows/dividends remain plump for many stocks in the sector. For dividend seekers, the sector could offer a growth play with a side of income.

Use our Dividend Screener to find high-quality dividend stocks based upon 16 parameters. That includes semiconductor-related common stocks and ADRs.

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