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Big Dividend Boost Grabs Cramer’s Attention

After a sizable dividend hike, does this semiconductor stock belong on your radar?

"If you're looking for a sign that management is feeling confident about their company's long-term prospects, there are few better tells than a dividend boost," said Jim Cramer on Wednesday's broadcast.

And Xilinx, a semiconductor company, just put through a fairly hefty boost – it's 13.6%.

The move brings the yield up to 2.65%."You better believe I took notice," said Cramer.

The Mad Money host said Xilinx has strong appeal. "It designs a proprietary product in a duopoly business where Altera is the only real competition," he said.

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Their chips are used in everything from communications and data centers to high-end driver safety and more.

Also, "Xilinx's programmable chips allow companies to get their products to market faster, and they also allow their clients to cram more functions into fewer chips that use less power—the holy grail in designing devices," Cramer added.

SelectStock | Agency Collection | Getty Images

To make the stock all the more appealing, when Xilinx reported back in January 17th, the company's gross margin were a whopping 66%.

However, there is cause for at least some concern, Xilinx gave downside guidance for the next quarter. Also, rival Altera, just last week inked a deal to have Intel manufacture their chips, and that might make Alterable more formidable.

"However, at an analyst day earlier in the week, management said they expect growth to pick up in the second half of the year," said Cramer. "They're anticipating stronger wireless sales in tandem with next-generation LTE network rollouts in both North America, and in China, where Xilinx has a terrific track record of winning contracts."

It's certainly something worth watching.

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