We recently published a list of 10 Companies that Just Raised their Dividends. In this article, we are going to take a look at where Analog Devices, Inc. (NASDAQ:ADI) stands against other companies that just raised their dividends.

Dividend stocks have been attracting investor interest for quite some time, consistently delivering strong performances that highlight their long-term appeal. This growing investor preference has led many major technology companies to introduce dividend payments. As a result, dividends are no longer limited to traditional value stocks, with growth-oriented firms also emerging as significant dividend payers.

Historical trends show that dividend-paying stocks have consistently outperformed other asset classes across various market cycles. A report from T. Rowe Price highlights that dividends have made up nearly one-third of total equity returns for US stocks since 1926. During the period from 1980 to 2019, which saw a decline in interest rates, dividends contributed to 75% of the broader market’s overall returns.

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By the end of September 2024, approximately 80% of companies in the broader market were distributing dividends—a proportion that has remained relatively steady over the past decade. Notably, the technology sector represented nearly 24% of dividend-paying companies, a significant rise from 13% ten years ago. Other industries, such as healthcare and industrials, also experienced an uptick in firms offering dividends. This broader availability of dividend-paying stocks has provided income-focused investors with more opportunities to gain exposure to high-growth and innovative businesses. Given these developments, analysts maintain a positive outlook for dividend stocks as they head into 2025.

Dividend growth is closely tied to a strong earnings season. In February, the broader market struggled, declining by over 2% as concerns about inflation, upcoming tariffs under former President Donald Trump, and escalating geopolitical tensions weighed on investor sentiment. On February 28, the major index briefly dipped into negative territory for 2025. However, corporate earnings reports for the fourth quarter have provided a fresh catalyst for the market.

As of February 28, nearly 97% of companies in the broader market had reported earnings, with over 75% surpassing analyst expectations, according to FactSet. Many of these companies delivered encouraging news for income-focused investors. In the week ending February 25, data from JPMorgan showed that 20 companies announced dividend increases, with no reports of dividend cuts or suspensions during that period. This is positive for income investors, as dividend growth is always a welcomed development for them.

Howard Silverblatt, Senior Index Analyst at S&P Dow Jones Indices, made the following comment about the situation:

“Many companies have the ability and cash-flow to increase their dividend payments, but remain concerned over the economy, government spending and taxing policy. Given the continued economic growth with lower interest rates and the relatively low unemployment rate, a clearer picture of potential policy should emerge in the first quarter, at which time more companies can better evaluate their future commitment.”

Companies continued to raise their dividends throughout the fourth quarter of 2024. A report from S&P Dow Jones Indices noted that 635 dividend hikes were recorded during the quarter, totaling $14.2 billion. Over the 12-month period, total dividend increases reached $71.4 billion, marking an increase from $65.1 billion in the previous year.

Our Methodology

For this list, we first scanned the list of companies that raised their dividend payouts in 2025 so far. Then, we picked prominent companies with strong dividend histories and solid cash positions. From that group, we picked 10 companies with the highest number of hedge fund investors, according to Insider Monkey’s database of Q4 2024. The stocks are ranked in ascending order of their hedge fund holders.

Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).

A technician working on power management in a semiconductor factory.

Analog Devices, Inc. (NASDAQ:ADI)

Number of Hedge Fund Holders: 64

Analog Devices, Inc. (NASDAQ:ADI) is an American semiconductor manufacturing company that mainly deals in integrated circuits and systems. The company focuses on researching, developing, and producing high-performance analog, mixed-signal, and digital signal processing integrated circuits (ICs). Its technologies play a crucial role in enabling electronic systems to capture and process real-world data effectively.

Lately, Analog Devices, Inc. (NASDAQ:ADI) has emphasized launching new products and forming strategic partnerships, driving innovations such as the CodeFusion Studio and ADI Assure Trusted Edge Security Architecture. In the fourth quarter of 2024, the company reported revenue of $2.42 billion, which declined by 3.56% from the same period last year. However, the revenue beat analysts’ estimates by $63.55 million. The company saw sequential growth in its Industrial, Automotive, and Communications segments, while its Consumer division recorded double-digit growth compared to the previous year.

Analog Devices, Inc. (NASDAQ:ADI)’s cash position remained strong, which makes it a reliable option for income investors. In the most recent quarter, the company generated $1.12 billion in operating cash flow, which represented 47% of total revenues. Its free cash flow, accounting for 40% of the revenue, came in at $978 million. On February 19, the company declared an 8% hike in its quarterly dividend to $0.99 per share. This marked the company’s 21st consecutive year of dividend growth. The stock has a dividend yield of 1.75%, as of March 6.

Overall, ADI ranks 9th on our list of companies that just raised their dividends. While we acknowledge the potential for ADI as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than ADI but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.

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Disclosure: None. This article is originally published at Insider Monkey.