3 AI Dividend Stocks With Healthy Yields

Almost all software companies categorize themselves as part of the artificial intelligence sector. High valuations are synonymous with that category, so prices have surged across the board. The Nasdaq 100’s price-earnings ratio today is at 40.7 times, comparable to the 2021 bubble. Historically, the median value has been at 20.7 times.

Obviously, there’s plenty of growth and a life-changing technology behind that. But the price tags on many tech stocks will make anyone balk. AI stocks also rarely pay a dividend as they are investing as much cash as possible into their businesses to go all-in on growth. Those that do pay dividends usually yield ~1-2%.

Can you still find good dividend-paying AI stocks in this environment without nosebleed valuations? It’s still possible. Below are three stocks with plenty of AI exposure and solid dividend yields.

HP Inc (HPQ)

Printers and cheap laptops are probably the first things that spring to mind when you think of HP Inc (NYSE:HPQ). However, the business can get much hotter as HP is focusing more on growth inchmeal. This is a mature business that generates significant cash flow, but the lack of growth is why it hasn’t delivered much upside in the past few years.

In fact, HPQ stock is down 25% year-to-date due to tariff-related concerns.

A sharp recovery is likely. HP is releasing new AI-infused products, like the New EliteBook Ultra, OmniBook X, and Z workstations ship with on-chip NPUs (up to 50 TOPS) to run local large-language-model and vision workloads without the cloud. After DeepSeek R1’s release, these local models are gaining popularity.

HP also has Cloud service and on-prem workstation bundles for building, tuning, and deploying generative-AI models for data science teams.

The company has very strong cash flow and has reduced its outstanding shares from 1.712 billion in FY 2016 to 938.989 million in FY 2024. This is mainly through aggressive dividends and buybacks.

You’re only paying a bit over 13 times enterprise value for HPQ stock. In return, you get some of the strongest cash flow and plenty of AI exposure. I see 60%-plus upside potential over the next 24 months.

The dividend yield of 4.72% is better than 83.2% of peer companies, and the 3-year average share buyback ratio of 4.9%  is better than 98.63% of peer companies.

Verizon (VZ)

Verizon (NYSE:VZ) has been overlooked for too long as a stale, debt-ridden telecom company, but the underlying business seems poised to make a full recovery like AT&T (NYSE:T) has done.

Wall Street will get increasingly bullish on telecom companies as it becomes apparent that companies in the networking space will be key beneficiaries of the data center/cloud computing boom. Verizon has a huge 5G network, metro fiber, and its own data centers that hyperscalers can use to minimize latency significantly.

AI-powered personalized wireless plans are used by nearly half of Verizon’s consumer base. The company has partnerships with Nvidia (NASDAQ:NVDA), Vultr, Meta Platforms (NASDAQ:META), and Google Cloud.

$167.7 billion in debt is mainly to blame for Verizon being a laggard in recent years. The company posted $6.3 billion in FY 2024 net interest losses. This is a record number, but interest rate cuts will eventually ease this burden.

Regardless, Verizon still posted $17.5 billion in net income that fiscal year, covering its dividend payments of $11.249 billion. VZ stock now yields 6.55%.

OpenText (OTEX)

OpenText (NASDAQ:OTEX) is a software company that manages content and unstructured data for companies. That’s where AI specializes, and OpenText is going all-in by pursuing an “AI-first” strategy.

It has an AI product called OpenText Aviator, integrated with OpenText’s Business Cloud. Clients can use generative AI and large language models to search and easily manage data. OpenText claims it can free up to 70% of a team’s time through features like conversational search and summarization.

OTEX stock is down 48% from its 2021 peak but could bottom out soon as financials stabilize. Analysts expect EPS to decline by 11.8% this fiscal year (ends in June 2025) before recovering by 10.5% and growing from there. The 11% decrease in revenue this fiscal year is mainly due to the divestiture of its AMC business.

You can sit on its 3.75% dividend yield as you wait for the business to make an AI-driven turnaround. Growth is low, but management is moving in the right direction by cost-cutting and integrating AI.

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