3 Prominent Tech Companies With A Good Chance For Increasing/Initiating Dividends in the Future (MSFT, GOOG, IBM)

Many analysts are quite enamored with large cap technology companies these days, and for good reason.

Many companies in the sector are in a growing secular industry with years of expansion ahead of them. In addition many have little or no debt and have ample cash on the balance sheets.

Because of these factors the companies that used to be more speculative and pure capital appreciation plays have become more and more "blue techs". The 3 following companies are primed to either initiate a dividend for the first time or increase their current dividends.

Microsoft (NASDAQ: MSFT) - The company is a cash flow machine, with a strong defense around its bread and butter software products. Also the company has been treading into the high growth mobile internet and internet search areas. Normalized EPS is around $1.77 and with a current dividend of $0.52, the payout ratio is around 29%. This leaves ample room for increases.

International Business Machines (NYSE: IBM) - The company has a great diversification of products and technology services. This makes earnings quite stable and "recession resistant". In fact over the past 2 years the company's stock is actually marginally higher. Normalized EPS is around $9.80 and the dividend is $2.20. With a payout ratio of 22% again much opportunity for future increases.

Google Inc (NASDAQ: GOOG) - Google, Inc. has quickly become one of the most important technology companies in existence. Growth has been incredible and profit margins are impressive. No debt, $61/share in cash, and normalized EPS of $22/share are all great metrics. Although for the next 2-3 years dividends are unlikely, once further out the company will most likely give investors a return of the some of the cash on hand.