At the onset of the second quarter of 2024, three financial gurus from Motley Fool are focusing on dividend ventures. They have identified some straightforward dividend stocks worth buying this April. Here’s why they’re fans of AbbVie (NYSE: ABBV), Gilead Sciences (NASDAQ: GILD), and Pfizer (NYSE: PFE).
One of the most appealing dividend opportunities out there
Keith Speights (AbbVie): What’s more enticing than a substantial dividend return? I’d venture to say a generous dividend combined with an escalating payout. That’s precisely what AbbVie offers.
Let’s delve into the pharmaceutical company’s dividend yield which stands at nearly 3.6%. AbbVie is no stranger to high yields, consistently surpassing the 3% mark over the years.
When it comes to dividend expansion, AbbVie outshines its peers. Since its separation from Abbott Labs in 2013, AbbVie has amplified its dividend distribution by almost 288%. A reputable Dividend King, AbbVie has increased its dividends for 52 consecutive years (during 42 of these years, it was part of Abbott).
Can AbbVie sustain this dividend growth momentum? I believe so. The company anticipates generating free cash flow of approximately $18 billion this year, having disbursed $10.5 billion in dividends in 2023.
Granted, AbbVie’s revenue and profits suffered due to the expiration of U.S. exclusivity for its leading product, Humira. Nonetheless, the company is optimistic about returning to revenue expansion next year, expecting a high single-digit Compound Annual Growth Rate (CAGR) through the decade’s conclusion.
I concur with this optimistic projection. AbbVie’s two successors to Humira — Rinvoq and Skyrizi — are anticipated to surpass Humira’s peak annual sales. Additionally, AbbVie boasts promising products such as migraine medications Ubrelvy and Qulipta. The acquisitions of ImmunoGen and Cerevel Therapeutics should further propel its growth.
Gilead’s notable yield and resilience make it an excellent choice for income-oriented investors
David Jagielski (Gilead Sciences): Gilead Sciences stands out as a premier healthcare equity that investors can confidently integrate into their portfolios this month. With a robust foundation in the HIV treatment segment, the company is well-positioned to deliver consistent outcomes given the sustained demand for treatment. Over the past three years, Gilead’s revenue has hovered around $27 billion. While its bottom line has displayed a bit more…
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