The most effective way to benefit from dividend-paying stocks is when the rise in their capital value does the majority of the work. Companies like Micron Technology, Alphabet, and Alibaba might not boast impressive dividend yields, as they remain below 0.7%, but they excel in growth performance.
Despite their low income generation, they demonstrate remarkable gains. Here’s how these three successful companies have performed over the past year:
- Micron: 317% increase.
- Alphabet: 69% increase.
- Alibaba: 63% increase.
Let’s explore why investing in these tech giants makes sense, even if their dividends aren’t substantial.
Micron’s stock has experienced an increase of over 300%, a notable achievement for a company specializing in memory and storage solutions with revenues of $42.3 billion. Usually, cyclical companies don’t see such vast movements in stock price.
You might instinctively feel wary about investing in Micron after such a surge. However, if you take a moment to look closer, the company’s fundamentals have actually improved dramatically in the last year. In just the past three months, analysts have more than doubled their earnings forecasts for the next two years.
Now, you might think that Micron is overvalued after its spectacular rise, but it’s available for less than 12 times its expected earnings. A year ago, it was trading at less than three times its 2026 revenue projections. Clearly, nobody could predict such growth back then. As for future earnings, it remains uncertain how high they might climb. Micron is crucial in constructing data centers essential for the AI boom, suggesting significant potential for further growth. The minimal yield may not attract income-focused investors, but it complements the substantial capital gains beautifully.
Alphabet, on the other hand, has established itself as the leading player. Last year, it wasn’t so straightforward; however, a 15% revenue growth in 2025 marks Alphabet’s highest in four years, indicating a strengthening position with impressive profit margins reaching 33%.
Having dominated the search engine space for over two decades, Google is also gearing up for a competitive edge in AI. Last week, Alphabet made headlines, announcing capital investments of $185 billion by 2026, a quite significant sum, especially considering its recent record profits. Although the 0.3% dividend might seem small, it comes alongside a substantial increase of 69% in stock value over the previous year.
In terms of Alibaba, while its 0.65% yield tops the list, it’s evident this analysis isn’t focused solely on dividend yields. Alibaba represents a major player in global e-commerce and is notably positioned in the second largest economy worldwide.
There’s always room to understand Alibaba better. Moving into next year, its earnings multiple is expected to hover in the high 10s. The narrative could become even more intriguing as Alibaba emerges as a potential AI chip supplier in China—this could be a significant catalyst, particularly if trade dynamics shift between its home country and U.S. chip manufacturers.
Before considering any investment in Micron Technology, keep the following in mind:
Analysts have pinpointed what they estimate to be the ten top stocks worth investing in right now, and Micron Technology isn’t one of them. These stocks could present remarkable returns over the next few years.
For context, if one had invested $1,000 in Netflix back in December 2004, it would have ballooned to approximately $443,299 today, or if you’d invested in Nvidia in April 2005, that $1,000 would have grown to around $1,136,601.
It’s critical to remember that the average return from the stock advisor service sits at 914%, in stark contrast to the S&P 500’s 195%. Don’t overlook the latest top stock list; it’s worth connecting with a community of retail investors who are just like you.
