There are dividend stocks. And then there are dividend stocks that also happen to be among the best-performing stocks of the past decade.

Broadcom falls into that second, very rare category.

Most investors know Broadcom (AVGO) as a semiconductor and infrastructure software giant.

Fewer realize what it’s done for long-term shareholders, not just in price appreciation, but in growing income over time.

The numbers tell a striking story. And if you had $1,000 sitting in AVGO stock back in 2016, you’d be looking at a very different number in your brokerage account right now.

AVGO is a long-haul dividend stock winner

Let’s start with the raw return. A $1,000 investment in AVGO stock in 2016 would be worth approximately $20,000 today on price appreciation alone, notes Stock Titan. That’s a gain of roughly 1,890%.

Factor in dividends reinvested over that period, and the total climbs to around $25,600: a cumulative return of about 2,460%.

But the story gets better when you zoom in on what the dividend itself has done.

Back in 2016, $1,000 bought you about 63 shares of AVGO. The annualized dividend at the time was $0.20 per share.

So those 63 shares generated just $12.60 in annual dividend income — a yield of 1.26% on your original investment. Not exactly eye-catching.

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Fast forward to today. Broadcom now pays $2.60 per share annually. Those same 63 shares now generate $163.80 per year in dividends. That’s a yield-on-cost of 16.38%.

Put simply, the income alone from that original $1,000 investment now exceeds what many savings accounts pay by a wide margin.

Broadcom’s dividend growth by the numbers

Here’s a snapshot of the key dividend metrics every income investor should know about AVGO stock.

  • 2016 annualized dividend per share: $0.20
  • Current annualized dividend per share: $2.60
  • Dividend growth (2016 to present): 1,200%+
  • Original yield on $1,000 investment (2016): 1.26%
  • Current yield-on-cost (same $1,000 investment): 16.38%
  • Annual dividend income from 63 shares today: $163.80
  • Annual dividend income from 63 shares in 2016: $12.60
  • Dividend payout cadence: Quarterly

The annual dividend expense for Broadcom stock is around $12.3 billion, while the company is projected to report a free cash flow of $49.5 billion in fiscal 2026, indicating a payout ratio of roughly 25%. 

AI is turbocharging AVGO’s growth engine

Broadcom isn’t just coasting on past success. The company’s most recent earnings report showed why analysts and investors remain bullish on its future.

  • In Q1 fiscal 2026, Broadcom posted record total revenue of $19.3 billion, up 29% year over year. 
  • AI semiconductor revenue more than doubled to $8.4 billion.
  • Broadcom CEO Hock Tan guided Q2 fiscal 2026 revenue to approximately $22 billion, a 47% YoY increase. 
  • AI semiconductor revenue for Q2 is projected to reach $10.7 billion, up 140% YoY.
  • Broadcom’s adjusted EBITDA (earnings before interest, taxes, depreciation, and amortization) came in at $13.1 billion for Q1, or 68% of revenue.

That kind of margin gives Broadcom stock significant room to keep rewarding shareholders.

Related: Broadcom could sustain its eye-popping 2026 dividend hike

The company also returned$10.9 billion to shareholders in Q1 through dividends and share repurchases, and its board authorized an additional $10 billion share repurchase program.

During the Q1 earnings call, CFO Kristin Spears stated:

“We ended the first quarter with $14.2 billion of cash. Today, we are announcing our Board of Directors has authorized an additional $10 billion for our share repurchase program effective through the end of calendar year 2026.”

Broadcom is bullish on AI growth.

Why Broadcom dividend stock still has runway

NurPhoto/ Getty Images One thing that stands out about Broadcom is its positioning inside the artificial intelligence infrastructure buildout.

The company designs custom AI accelerators, called XPUs, for six major customers, including Google and Anthropic.

On the most recent earnings call, Tan said the company has “line of sight” to exceed $100 billion in AI chip revenue in 2027. 

A company generating this level of AI-driven cash flow has a strong foundation for continued dividend growth, which Broadcom consistently maintained for a decade. 

The lesson here isn’t just about what $1,000 in 2016 is worth now. It’s about what patience, reinvested dividends, and a compounding dividend yield can do over time.

That’s the real story behind AVGO, and it’s one worth understanding before writing off any quality dividend stock as “not exciting enough.”

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