Rather than picking winning consumer tech stocks, investing in the companies that supply or power the technology sector has recently been a popular way to tap into the tech industry's growth.
Many investors have turned to buying a broad basket of semiconductor companies -- or a semiconductor ETF, for that matter -- to do just this. However, as in all industries, the semiconductor market has its winners and losers.
Keeping that in mind, let's review what makes Intel (NASDAQ:INTC) and NVIDIA (NASDAQ:NVDA) the best dividend-paying stocks to own in the semiconductor space.
Intel
The world's largest semiconductor company, Intel has established its business empire by building dominant franchises supplying processing power to the PC and server industries. The company controls an estimated 99% and 87% of the two multibillion-dollar hardware markets. This market dominance, in turn, affords Intel massive pricing power, as evidenced by its 60.9% gross margin during its fiscal 2016.
The past several years haven't been the best in Intel's vaunted corporate history. The company completely missed the smartphone revolution because of its longtime product-development strategy, which centered on maximizing processing power without regard for power usage.
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