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Is Microsoft Corporation (NASDAQ:MSFT) the Best Quality Dividend Stock to Buy According to Reddit?

Dividend stocks are in the limelight this year as many tech companies have joined the dividend club since the start of 2024. In addition to this, global companies have distributed a record amount in dividends last year. Retail investors are always on the lookout for income stocks. For this reason, we have analyzed the 15 Best Quality Dividend Stocks to Buy According to Reddit in a new article. In this article we are going to take a look at whether Microsoft Corporation (NASDAQ:MSFT) is the best quality dividend stock to buy according to Reddit.

Microsoft Corporation (NASDAQ:MSFT)

Microsoft Corporation (NASDAQ:MSFT) is a Washington-based multinational technology company that is mainly known for its Windows operating systems. In addition to this, the company also offers a wide range of services through its cloud-computing platform. Microsoft Corporation (NASDAQ:MSFT) was the most popular company among elite funds at the end of Q4 2023, with 302 hedge funds holding stakes in the company, as per Insider Monkey’s database. The collective value of these stakes is over $87.3 billion.

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Microsoft Corporation (NASDAQ:MSFT) is a Leader in Technology and Innovation

Microsoft Corporation (NASDAQ:MSFT) has revolutionized both personal and business computing with its products for the software industry. The company’s Azure cloud computing platform is widely gaining momentum among business professionals. Its revenue from cloud services is a significant contributor to its total earnings. In the company’s most recent quarter, it reported a 23% year-over-year growth in its cloud revenue at over $35 billion.

Vulcan Value Partners mentioned Microsoft Corporation (NASDAQ:MSFT) in its Q1 2024 investor letter. Here is what the firm has to say:

“Microsoft Corporation (NASDAQ:MSFT) is the world’s largest software company with a broad range of offerings including Microsoft office, gaming, Azure cloud computing, LinkedIn, and more. It was a material contributor for the second consecutive quarter, and we discussed it at length in last quarter’s letter. The company continues to execute well.”

Microsoft’s Strong and Stable Dividend Growth

Where tech companies mainly prefer reinvesting profits into growth and innovation, Microsoft Corporation (NASDAQ:MSFT) changed the paradigm and initiated its dividend policy in 2003 with a per-share dividend of $0.08. The company has been growing its payouts for the past 18 consecutive years, currently offering a quarterly dividend of $0.75 per share. In addition to this, the company’s 5-year average dividend growth rate comes in at 10.23%. With a payout ratio of 25.3%, Microsoft Corporation (NASDAQ:MSFT)’s dividend is also sustainable. This means that the company distributes less than one-third of its profits to shareholders as dividends.

Microsoft’s Financial Health Makes it a Dividend Star

Microsoft Corporation (NASDAQ:MSFT) recently announced its fiscal Q3 2024 earnings and reported revenue of roughly $61.8 billion, which showed a 17% growth from the same period last year. The revenue not only showed growth but also beat analysts’ estimates by $1.01 billion. Its operating income amounted to $27.6 billion, up 23% from the third quarter of 2023. During the quarter, the company generated $32 billion in operating cash flow, up from $24.4 billion in the prior year period. The company’s solid cash position enabled it to uphold its commitment to shareholders by returning $8.4 billion to them through dividends and share repurchases in Q3 2024.

Microsoft Corporation (NASDAQ:MSFT)’s Dividend Yield Misses the Mark

While Microsoft Corporation’s (NASDAQ:MSFT) dividend is strong and sustainable, the stock’s dividend yield tends to come up short when compared to some other high-yield dividend stocks in the market. As of May 18, the stock has a dividend yield of 0.71%, which is less than a 1.3% yield for the S&P 500. The low dividend yield does not satisfy income investors, who seek regular income on their dividend investments. The stock can be added to a diversified dividend portfolio but this means missing out on other high-yield dividend stock opportunities.

Reddit’s Take on Microsoft’s Future Prospects

According to the Reddit community, Microsoft is currently offering strong financial health along with stable dividend growth. However, some Redditors expressed concerns about the stock being modestly overvalued. The stock is currently trading at a P/E multiple of 36.5x, which is seen as too high by some. Moreover, its competitive industry may push the company to prioritize capital expenditure over dividends to remain relevant.

Is Microsoft Corporation (NASDAQ:MSFT) the Best Quality Dividend Stock to Buy According to Reddit? 

Microsoft Corporation (NASDAQ:MSFT) is picked by Reddi readers as the best quality dividend stock due to its financial health and consistent dividend growth. That said, if you are concerned about its relatively low dividend yield and high valuation you should consider other high-yield dividend stocks on our list of the 15 Best Quality Dividend Stocks to Buy or 5 Undervalued Stocks That Just Raised Their Dividends. If you are looking for an AI stock that is as promising as Microsoft but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.

READ NEXT: Michael Burry Is Selling These Stocks and A New Dawn Is Coming to US Stocks.

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

AI, Tariffs, Nuclear Power: One Undervalued Stock Connects ALL the Dots (Before It Explodes!)

Artificial intelligence is the greatest investment opportunity of our lifetime. The time to invest in groundbreaking AI is now, and this stock is a steal!

AI is eating the world—and the machines behind it are ravenous.

Each ChatGPT query, each model update, each robotic breakthrough consumes massive amounts of energy. In fact, AI is already pushing global power grids to the brink.

Wall Street is pouring hundreds of billions into artificial intelligence—training smarter chatbots, automating industries, and building the digital future. But there’s one urgent question few are asking:

Where will all of that energy come from?

AI is the most electricity-hungry technology ever invented. Each data center powering large language models like ChatGPT consumes as much energy as a small city. And it’s about to get worse.

Even Sam Altman, the founder of OpenAI, issued a stark warning:

“The future of AI depends on an energy breakthrough.”

Elon Musk was even more blunt:

“AI will run out of electricity by next year.”

As the world chases faster, smarter machines, a hidden crisis is emerging behind the scenes. Power grids are strained. Electricity prices are rising. Utilities are scrambling to expand capacity.

And that’s where the real opportunity lies…

One little-known company—almost entirely overlooked by most AI investors—could be the ultimate backdoor play. It’s not a chipmaker. It’s not a cloud platform. But it might be the most important AI stock in the US owns critical energy infrastructure assets positioned to feed the coming AI energy spike.

As demand from AI data centers explodes, this company is gearing up to profit from the most valuable commodity in the digital age: electricity.

The “Toll Booth” Operator of the AI Energy Boom

  • It owns critical nuclear energy infrastructure assets, positioning it at the heart of America’s next-generation power strategy.
  • It’s one of the only global companies capable of executing large-scale, complex EPC (engineering, procurement, and construction) projects across oil, gas, renewable fuels, and industrial infrastructure.
  • It plays a pivotal role in U.S. LNG exportation—a sector about to explode under President Trump’s renewed “America First” energy doctrine.

Trump has made it clear: Europe and U.S. allies must buy American LNG.

And our company sits in the toll booth—collecting fees on every drop exported.

But that’s not all…

As Trump’s proposed tariffs push American manufacturers to bring their operations back home, this company will be first in line to rebuild, retrofit, and reengineer those facilities.

AI. Energy. Tariffs. Onshoring. This One Company Ties It All Together.

While the world is distracted by flashy AI tickers, a few smart investors are quietly scooping up shares of the one company powering it all from behind the scenes.

AI needs energy. Energy needs infrastructure.

And infrastructure needs a builder with experience, scale, and execution.

This company has its finger in every pie—and Wall Street is just starting to notice.

Wall Street is noticing this company also because it is quietly riding all of these tailwinds—without the sky-high valuation.

While most energy and utility firms are buried under mountains of debt and coughing up hefty interest payments just to appease bondholders…

This company is completely debt-free.

In fact, it’s sitting on a war chest of cash—equal to nearly one-third of its entire market cap.

It also owns a huge equity stake in another red-hot AI play, giving investors indirect exposure to multiple AI growth engines without paying a premium.

And here’s what the smart money has started whispering…

The Hedge Fund Secret That’s Starting to Leak Out

This stock is so off-the-radar, so absurdly undervalued, that some of the most secretive hedge fund managers in the world have begun pitching it at closed-door investment summits.

They’re sharing it quietly, away from the cameras, to rooms full of ultra-wealthy clients.

Why? Because excluding cash and investments, this company is trading at less than 7 times earnings.

And that’s for a business tied to:

  • The AI infrastructure supercycle
  • The onshoring boom driven by Trump-era tariffs
  • A surge in U.S. LNG exports
  • And a unique footprint in nuclear energy—the future of clean, reliable power

You simply won’t find another AI and energy stock this cheap… with this much upside.

This isn’t a hype stock. It’s not riding on hope.

It’s delivering real cash flows, owns critical infrastructure, and holds stakes in other major growth stories.

This is your chance to get in before the rockets take off!

Disruption is the New Name of the Game: Let’s face it, complacency breeds stagnation.

AI is the ultimate disruptor, and it’s shaking the foundations of traditional industries.

The companies that embrace AI will thrive, while the dinosaurs clinging to outdated methods will be left in the dust.

As an investor, you want to be on the side of the winners, and AI is the winning ticket.

The Talent Pool is Overflowing: The world’s brightest minds are flocking to AI.

From computer scientists to mathematicians, the next generation of innovators is pouring its energy into this field.

This influx of talent guarantees a constant stream of groundbreaking ideas and rapid advancements.

By investing in AI, you’re essentially backing the future.

The future is powered by artificial intelligence, and the time to invest is NOW.

Don’t be a spectator in this technological revolution.

Dive into the AI gold rush and watch your portfolio soar alongside the brightest minds of our generation.

This isn’t just about making money – it’s about being part of the future.

So, buckle up and get ready for the ride of your investment life!

Act Now and Unlock a Potential 100+% Return within 12 to 24 months.

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A New Dawn is Coming to U.S. Stocks

I work for one of the largest independent financial publishers in the world – representing over 1 million people in 148 countries.

We’re independently funding today’s broadcast to address something on the mind of every investor in America right now…

Should I put my money in Artificial Intelligence?

Here to answer that for us… and give away his No. 1 free AI recommendation… is 50-year Wall Street titan, Marc Chaikin.

Marc’s been a trader, stockbroker, and analyst. He was the head of the options department at a major brokerage firm and is a sought-after expert for CNBC, Fox Business, Barron’s, and Yahoo! Finance…

But what Marc’s most known for is his award-winning stock-rating system. Which determines whether a stock could shoot sky-high in the next three to six months… or come crashing down.

That’s why Marc’s work appears in every Bloomberg and Reuters terminal on the planet…

And is still used by hundreds of banks, hedge funds, and brokerages to track the billions of dollars flowing in and out of stocks each day.

He’s used this system to survive nine bear markets… create three new indices for the Nasdaq… and even predict the brutal bear market of 2022, 90 days in advance.

Click to continue reading…