Dell Inc., the world's third-largest maker of personal computers, initiated a quarterly dividend of 8 cents a share. The stock rose in extended trading.

The dividend will begin in the third quarter of the current fiscal year, the Round Rock, Texas-based company said today in a statement. The dividend yield would be 2.7 percent, based on yesterday's closing price, Dell said.

Chief Executive Officer Michael Dell has been acquiring makers of data storage, networking gear and business software to diversify beyond PCs as tablets and smartphones siphon sales. The company is expanding in enterprise solutions to offer corporations a broader lineup of products and services to run technology operations.

“With the cash flows we've been generating, up 5 percent last year, we're very happy to initiate this dividend and return more capital to shareholders,” Dell said in an interview on CNBC.

Dell climbed as much as 6.6 percent in extended trading after closing at $11.97 in New York. The stock has dropped 18 percent this year.

Through the dividend and share repurchases, Dell said it plans to return 20 percent to 35 percent of free cash flow to investors, up from a prior projection of 10 percent to 30 percent. Over the past four quarters, Dell has generated $4.9 billion in cash flow from operations.

Dividend Yields

The company lost share in the global PC market in the first three months of the year and trails Hewlett-Packard Co. and Lenovo Group Ltd., according to market researcher Gartner Inc.

Hewlett-Packard's dividend yield is 2.5 percent, while Lenovo's is 2 percent, according to data compiled by Bloomberg.

In February, Dell projected fiscal 2013 earnings excluding some items of at least $2.13 a share. CEO Dell and Chief Financial Officer Brian Gladden will update analysts on the company's outlook a meeting tomorrow in Austin, Texas.

Dell in May said revenue for the quarter ending in July would be $14.7 billion to $15 billion.

Bloomberg News

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Dell Initiates Dividend

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