When it comes to Artificial intelligence (AI) stocks, dividend returns aren’t what investors have in mind. Among the technology stocks in the S&P 500 Index; about half pay no dividends at all. Generally, these names tend to give you a big return on your purchase.
This comes as firms in this sector are focused on growth rather than providing money to investors. Companies legally must pay dividends when they declare them, but no such requirement exists for buybacks. Therefore, acquisitions give technology companies more flexibility in balancing growth efforts with shareholder returns.
In this context, for AI stocks, many of which are technology companies, any kind of dividend return is a nice cherry on top. Notably, three of the biggest names in AI recently announced dividend hikes.
Alphabet’s Dividend Rises Amid Mag 7’s High Performance
Except for NVIDIA NASDAQ: NVDAAlphabet is Google’s parent company NASDAQ: GOOGL may be the most relevant public company in the world right now in AI. The hyperscaler recently posted a blockbuster earnings report, and its share price rose 10% in response. The figures crushed earnings per share (EPS), benefiting from strong growth in its cloud segment. Impressive valuations of private investments in companies like SpaceX and Anthropic also add to your thinking.
The Alphabet Today
- 52 week interval
- $156.16
▼
$402.00
- Dividend Yield
- 0.22%
- The P/E ratio
- 30.06
- Target Value
- $407.86
Meanwhile, the company is in the early stages of selling its tensor processing units to third-party data center operators. This positions Alphabet as a potential, but not yet proven, challenger to NVIDIA’s AI chip dominance. Overall, Alphabet shares are up more than 25% in 2026, the best performance of any Magnificent Seven stock.
Google also announced a modest 5% increase in its budget on its latest earnings call. Its quarterly dividend will rise to 22 cents per share, payable on June 15 to shareholders of record as of the close on June 8. This gives the stock an annual dividend yield of 0.2%.
Investors will note that the stock’s yield has remained remarkably stable over the past year, at more than 0.5%. Since then, Alphabet’s shares have risen more than 150%, which shows how rising stock prices can create pressure. However, on the basis of low costs, those who invested at that time still benefited from high returns.
Western Digital Announces 20% Return Increase as Stock Catalog
Western Digital NASDAQ: WDC has gone from a boring name making legacy data storage technology to one of the hottest stocks in AI. Over the past 52 weeks, Western Digital has delivered a return that now sits just under 1,000%.
Western Digital Today
Western Digital
- 52 week interval
- $46.40
▼
$520.78
- Dividend Yield
- 0.10%
- The P/E ratio
- 30.71
- Target Value
- $395.83
The company sees a tremendous demand for hard disk drives (HDDs) as hyperscalers seek data storage solutions to support AI model workloads. In its most recent quarter, revenue increased 45% year-over-year (YOY) and gross margin increased by more than 1,000 basis points to more than 50%.
Western Digital has already sold its HDD capacity through 2026 and has hyperscaler contracts extending to 2029. By investing in new HDDs rather than increasing production, the company protects its prices while also limiting costs.
Amid incredible demand for its products, Western Digital also announced a 20% dividend increase. The company’s quarterly dividend will rise to 15 cents per share, payable on June 17 to shareholders of record as of the June 5 close. paid a dividend of 0.1 %.
Although its yield is very low, Western Digital has at least been raising its dividends in the past. This marks the company’s second major dividend increase in less than a year, with its last 25% increase coming in October 2025.
Comfort Systems Raises Profits for Seventh Time in 2 Years
Stored by Comfort Systems USA NYSE: CORRECT. Although not a technology stock, the company has been deeply involved in AI development, delivering critical data center infrastructure. The company provides heating, ventilation, and air conditioning (HVAC) systems that are deployed at scale in AI data centers.
Comfort Systems USA Today
Comfort Systems USA
- 52 week interval
- $446.77
▼
$2,024.99
- Dividend Yield
- 0.14%
- The P/E ratio
- 58.36
- Target Value
- $1,923.20
The company saw revenue rise 56% YOY in its most recent quarter, Comfort Systems’ fastest growth rate in more than 25 years. Diluted EPS rose more than 120% YOY to 10.51, the company posted a bigger beat than expectations of $6.81.
Notably, the end-to-end Comfort System market, made up primarily of data centers, accounts for 56% of revenue. Three years ago, technology was just 19% of total revenue, indicating that data centers have quickly become the most important market for Comfort Systems. In the past 12 months, shares of Comfort Systems have risen more than 350%.
Additionally, Comfort Systems issued a massive 14% increase in its quarterly earnings to 80 cents per share. The company plans to pay its next dividend on May 26 to shareholders of record as of the close on May 15. The stock’s implied yield is very small, close to 0.1%.
However, Comfort Systems has also increased its dividend at an unprecedented pace. This is the seventh comment a quarter respectively for the company to issue a dividend increase. In less than two years, the company’s profits increased 167% from 30 cents per share. Given the strength of its business, it would not be surprising to see this upward trend continue.
Alphabet Retains Analyst Support After Attractive Earnings
In this group, analysts see great potential in Alphabet, with many believing that Western Digital and Comfort Systems have extended valuations.
The MarketBeat consensus price on Alphabet sits near $408, which is very similar to its current level. However, the target rose significantly after the company’s latest earnings report. The revised price target is around $434, which means about 10% upside for the shares. Notably, Google has 49 analyst Buy ratings, while it has only 5 Holds and 0 Sells.
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