3 Promising Dividend Stocks That Insiders Have Been Buying -- Including Taiwan Semiconductor Manufacturing (TSM) Stock

We investors are often on the lookout for promising stocks, and we can get ideas from stock recommendations we run across online and also by poking around. For example, you might spend some time at a mall, seeing which retailers seem to be doing a brisk business. You might also look into records of insider purchases and sales, to see which companies have insiders buying shares.

Here are a handful of dividend-paying stocks that some insiders have been buying recently.

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1. Taiwan Semiconductor Manufacturing

With a recent market value topping $1.7 trillion, Taiwan Semiconductor Manufacturing (NYSE: TSM) is a giant among semiconductor companies. While most such companies only design chips, Taiwan Semiconductor actually manufactures them. It's a dividend payer, too, with a recent dividend yield of 1.04%. That may seem paltry, but the payout is growing fast, having more than doubled over the past five years.

Over the past three months, there have been five insider trades (as of April 3), and all have been buys. None have been major, though, with each purchase between 1,000 and 3,000 shares.

Should you consider this stock for your portfolio? Yes, indeed. The company's shares seem reasonably priced at recent levels, and they have grown in value at an average annual rate of around 30% over the past decade and 25% over the past 15 years. The company has a monopoly on making chips used for artificial intelligence (AI) processing, among other things, and demand for that is soaring.

2. Concentrix

Shares of customer-service specialist Concentrix (NASDAQ: CNXC) are also seeing insider activity, with 19 buys and 22 sales over the past three months. That may not seem promising, but note that 242,247 shares were bought, compared to 34,788 shares sold. Also, while it's hard to see insider buys as anything but promising, insiders can sell for many reasons other than a lack of faith in the company. They may just want to generate some cash, for instance -- to put a kid through college or buy a yacht.

Among other things, the company operates call centers for lots of other companies -- and some are worrying about the effect of AI on its business. To counter that, Concentrix is moving many call centers abroad, to reduce its costs, and it's been investing in AI itself, as well.

Shares look undervalued at recent levels, with a forward-looking price-to-earnings (P/E) ratio of 2.3 well below the five-year average of 6.1. (Both of those are low numbers, by the way.) In its recently reported first quarter, Concentrix posted revenue up 5.4% year over year, though earnings were down. The company bought back roughly a million shares, too, and continued its dividend payments, which recently yielded 5.3%.

If you buy into Concentrix (after further research, of course), you should probably do so mainly for the hefty dividend income -- and not for breakneck growth. (Note, too, that there are lots of other promising dividend payers out there.)

3. Simon Property Group

Simon Property Group (NYSE: SPG) is a real estate investment trust (REIT), and one of the largest operators of malls in America, at that. Over the past three months, it has had 14 insider buys and 14 sales, with about 8,000 shares bought vs. about 21,000 sold. That's not a promising ratio, but insiders will often sell simply to generate funds, and there's ample buying going on, along with the selling.

The stock recently sported a dividend yield of 4.6%, and its payout has been growing at an average annual rate of about 11% over the past five years.

It's worth noting that the company recently lost its CEO of 30-plus years (to cancer) and his son has now taken the reins. The family owns a meaningful stake in the company -- topping 7% of shares -- so it's clearly incentivized to see the business grow.

Give this real estate stock some consideration -- not only for its dividend income, but also its growth prospects. It boasts a strong balance sheet, with more than 250 properties that it leases to long-term customers, many of which are retailers. Retailers are indeed facing some challenges, such as from e-commerce, but Simon boasts high-quality malls, outlets, and spaces that are extra desirable.

Any or all of these stocks could serve you well for years, delivering income. Take a closer look at any that pique your interest.

Selena Maranjian has positions in Taiwan Semiconductor Manufacturing. The Motley Fool has positions in and recommends Simon Property Group and Taiwan Semiconductor Manufacturing. The Motley Fool has a disclosure policy.