Will Cisco Start the Age of the Tech Dividend?

Cisco

will begin to pay a dividend, which is expected to have a yield of 1% to 2%. The payout will start near the end of the company's fiscal year. A few large tech companies like IBM

and Microsoft

have payouts already. There has even been speculation that Microsoft will borrow money to increase its payout and begin a share buyback. The dividend is often considered a sign that a company's growth has begun to slow and that investors need a new incentive to buy shares. As some of the largest tech firms with huge amounts of cash have posted more modest year-over-year earnings, Cisco's move may be a precedent. It may also be an answer to investors who question what tech companies plan to do with their large cash balances. IBM has $13 billion in cash. Cisco has $35 billion and Microsoft over $36 billion. See the rest

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