You don't buy growth stocks primarily to generate income. Many of these stocks pay no dividends at all. However, that doesn't mean you can't earn dividend income from growth stocks.
The biggest growth stocks on the planet right now are the so-called “Magnificent Seven” stocks. Can you sit back and expect the dividends to roll in to these stocks? Yes, at least for some of them. Here is the dividend income you would receive if you invested $70,000 in Magnificent Seven stock:
Dividend split
There is a clear “dividend disparity” among the stocks in the Magnificent Seven. No doubt they all make enough profits to pay dividends, but only four companies actually pay dividends.
microsoft (MSFT -0.17%) launched its dividend program in 2003. Since then, the tech giant has increased its dividend every year.
apple (AAPL -1.06%) It technically started paying quarterly dividends decades ago. However, the company ended its dividend program in 1995 and did not resume paying dividends until 2012. Like Microsoft, Apple has consistently increased its dividend.
Nvidia (NVDA 0.12%) Perhaps the most surprising dividend stock of the Magnificent Seven. The leading chipmaker announced its first quarterly dividend in 2012. NVIDIA has been increasing its dividend regularly for several years, and has maintained a stable dividend since late 2019.
meta platform (meta -1.68%) The latest dividend payer of the Magnificent Seven. The social media company launched a dividend program in early 2024.
Amazon, alphabetand tesla We are not currently paying dividends. However, the situation may change for two of the three in the future. goldman sachs Analysts predict that Amazon and Alphabet could begin paying dividends, possibly as early as this year.
count money
So how much dividend income would you get if you invested $70,000 in Magnificent Seven stock? If you bought $10,000 of each stock, the total would be just under $170. The table below breaks down how much dividend each stock contributes.
| stock | dividend yield | Annual dividend income |
|---|---|---|
| microsoft | 0.71% | $71.00 |
| apple | 0.56% | $56.00 |
| meta platform | 0.41% | $41.00 |
| Nvidia | 0.018% | $1.80 |
| Amazon | Not applicable | $0.00 |
| alphabet | Not applicable | $0.00 |
| tesla | Not applicable | $0.00 |
| total | $169.80 | |
Data source: Google Finance. Calculations by the author. N/A = Not applicable.
Of course, if you were really looking for dividend income, you wouldn't buy Amazon, Alphabet, or Tesla stock. Let's crunch the numbers, assuming you invested $70,000 equally between his four dividend payers in the Magnificent Seven ($17,500 for each share). The following table shows how much you can earn.
| stock | dividend yield | Annual dividend income |
|---|---|---|
| microsoft | 0.71% | $124.25 |
| apple | 0.56% | $98.00 |
| meta platform | 0.41% | $71.75 |
| Nvidia | 0.018% | $3.15 |
| total | $297.15 | |
Data source: Google Finance. Calculations by the author. N/A = Not applicable.
Would most income investors be satisfied with less than $300 a year in dividend income from an initial investment of $70,000? Probably not.
limited splendor
The magnificence of the stock of the Magnificent Seven is limited. Neither offer attractive dividends. The dividend yield of Microsoft, which pays the highest dividend in the group, is still just over half of the stock price. S&P500.
If you invest in the Magnificent Seven, dividends are deferred. Buy these stocks expecting growth prospects. If you want solid dividend income, many other stocks are better.
John Mackey, former CEO of Amazon subsidiary Whole Foods Market, is a member of the Motley Fool's board of directors. Randi Zuckerberg is a former head of market development and spokesperson at Facebook, sister of Meta Platforms CEO Mark Zuckerberg, and a member of the Motley Fool's board of directors. Alphabet executive Suzanne Frye is a member of The Motley Fool's board of directors. Keith Speights has held positions at Alphabet, Amazon, Apple, Meta Platforms, and Microsoft. The Motley Fool has positions in and recommends Alphabet, Amazon, Apple, Meta Platforms, Microsoft, Nvidia, and Tesla. The Motley Fool recommends the following options: A long January 2026 $395 call on Microsoft and a short January 2026 $405 call on Microsoft. The Motley Fool has a disclosure policy.
