One Benefits from the AI Boom Without Being a Tech Company. The Other Makes the Tools. Both Have Been Paying Dividends for More Than a Century.
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It is commonly believed that the biggest winners from artificial intelligence are chip manufacturers. But some companies benefit from the AI boom in a quieter—and often more resilient—way.
American Electric Power (AEP) is one of the largest electricity providers in the United States.
Its connection to AI: The data centers that power artificial intelligence consume enormous amounts of electricity—and AEP supplies that power.
Track record: The company serves 5.6 million customers across 11 states, has been paying dividends since 1910, with more than 460 consecutive dividend payments, and has increased its dividend for 15 consecutive years.
Dividend yield: Approximately 2.9% — $0.95 per share quarterly, or $3.80 annually.
Performance: Over the past year, the stock has gained approximately 30%, reflecting the growing impact of the AI boom on its business.
Snap-on manufactures professional tools for mechanics and automotive service centers—the kind of brand whose name has become synonymous with quality.
Business model: Straightforward, stable, and predictable. Professional tools are purchased infrequently but used for many years.
Track record: The company has been paying dividends for more than 80 years and has increased them for 13 consecutive years.
Recent developments: Snap-on recently raised its dividend and announced a $500 million share repurchase program—a strong signal of management's confidence.
Dividend yield: Approximately 2.6% — $2.44 per share quarterly, or $9.76 annually.
Performance: The stock has appreciated by approximately 18% over the past year.
The role of companies like these in a portfolio is not to deliver spectacular returns, but to provide dependable stability. Defensive companies help reduce volatility, while high-growth businesses drive long-term capital appreciation. Achieving the right balance between the two is exactly what an effective investment strategy is designed to do. Both companies are expected to make their next quarterly dividend payments this autumn.
Would you like your portfolio to include both defensive and growth companies in the right proportions?
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*This material is provided for informational and educational purposes only and does not constitute individual financial advice. Dividends are declared and paid by the issuing companies, which independently determine the amount and payment dates.