The vast majority of the time, investments in the technology sector have absolutely nothing to do with dividends. The traditional growth model utilized by tech companies, large and small, is to take any free cash flow or operating cash flow generated by the underlying business, and pump it back into the company's core operations. After all, with such a high return on equity (presumably), why would one pay out earnings to shareholders?
Technology companies do often provide investors with wider margins, higher growth rates, and better profitability metrics than companies operating in non-tech sectors do. That being said, I've picked one real estate investment trust (REIT) which is being driven by the cloud revolution which does provide high dividends for income oriented investors seeking exposure to tech.
CoreSite Realty Corp. (NYSE:COR) is perhaps one of the best REITs out there, focused on housing data centers in major U.S. cities. The data centers housed by CoreSite run internet exchanges, making such data centers key components of the internet backbone we all rely upon on a daily basis. As such buildings are few and far between, and the real estate component of such enterprises are often forgotten about, investors are able to pick up a yield of approximately 4.7% at a relative valuation of half of the trust's peers.
CoreSite is one of my top picks currently and I will be considering adding a position on weakness in the near term.
Invest wisely, my friends.
