3 Big Dividend Hikes Hit the Market—1 Just Doubled Its Payout

Key Points

• The parent company of WWE and UFC secured massive media rights deals that are directly fueling substantial dividend growth.
• A leading semiconductor giant raised its dividend, lifting its yield to 1% after a significant payout increase.
• One of the world’s largest software firms boosted its dividend by 15%, underscoring confidence in its long-term growth.

Three big-name stocks just announced large dividend increases. Most notably, TKO Group NYSE: TKO just delivered a huge win to shareholders; the company doubled its dividend.

However, leading names in the semiconductor and software industries also made impressive moves of their own. Below, we’ll dive into the significant dividend news these three firms just released.

TKO: Massive Media Deals Lead to a Massive Dividend Increase

TKO Group is the owner of two well-known sports franchises: World Wrestling Entertainment (WWE) and the Ultimate Fighting Championship (UFC). As of the Sept. 5 close, the stock has provided a total return of around 96% since going public around two years ago. TKO has more than quadrupled its quarterly revenues over that time, as both WWE and the UFC have become increasingly popular. For those following this stock closely, the timing of TKO doubling its dividend may not come as a surprise.

The company announced two massive deals in August that should bolster its financial position substantially going forward. The first came with ESPN agreeing to pay $1.6 billion over the next five years for the rights to broadcast several of the WWE’s largest events. Just days later, TKO announced an even bigger deal. The newly formed company, Paramount Skydance NASDAQ: PSKY, agreed to pay $7.7 billion over the next seven years to exclusively broadcast UFC events. That $1.1 billion going to TKO a year is double the annual revenue it received from ESPN to broadcast UFC events previously. Clearly, TKO has a knack for generating increasingly lucrative media rights deals. Doubling its dividend, just like it doubled its UFC media deal, is a logical way to reward shareholders.

The company’s new 76 cents per share quarterly dividend is payable on Sept. 30 to shareholders of record as of the Sept. 15 close. As of the Sept. 5 close, the stock has a solid indicated dividend yield of just under 1.6%. Although TKO is not a high-yield stock, investors should note that its yield is substantially higher than the approximately 1.1% yield of the S&P 500 Index. Additionally, the company said it expects to begin share repurchases under its $2 billion buyback authorization in Q3. This buyback program is equal to around 5.2% of TKO's market capitalization, allowing the company to significantly reduce its outstanding share count. That’s another win for investors.

LRCX Boosts Dividend 13%, Yield Moves to 1%

Next up is one of the most important stocks in the semiconductor manufacturing equipment industry, Lam Research NASDAQ: LRCX. Lam is one of the five dominant players in this space, with a specific focus on making etch and deposition tools.

Having grown to a very large market capitalization of approximately $130 billion, Lam states that its technology helps build nearly every advanced chip made today.

On Aug. 28, Lam announced a sizable 13% increase to its quarterly dividend. The firm’s new 26-cent per share dividend is payable on Oct. 15 to shareholders of record on Sept. 24. Overall, this new payout gives the firm an indicated dividend yield of approximately 1%.

Although this figure is not overly impressive compared to the general market, it is solid when compared to most semiconductor stocks. With 60 or so global large-cap stocks in the semiconductor and semiconductor equipment industry, Lam’s indicated yield ranks in the top 20 highest among this group.

INTU Announces Large Dividend Increase, Holds Strong Yield in Software

Last up is software giant Intuit NASDAQ: INTU. With a market capitalization of around $188 billion, Intuit easily ranks among the top 10 most valuable software stocks in the world.

Along with releasing its quarterly financials on Aug. 21, Intuit announced a 15% increase to its quarterly dividend.

The new $1.20 dividend is payable on Oct. 17 to shareholders of record as of the Oct. 9 close.

Overall, the stock has an indicated dividend yield of 0.7%.

Although it is also not a high yield, it is important to note that the vast majority of software stocks do not pay a dividend at all.

Thus, Intuit’s indicated yield still ranks in the top 10 among large-cap software stocks globally.

TKO, LRCX, and INTU Sweeten the Pot for Income Investors

Overall, these three names are making good on their commitments to return increasingly higher levels of capital to shareholders.

Clearly, TKO’s dividend boost really stands out, with the company’s huge media deals allowing investors to put much more income in their pockets.