3 Stocks With Decades of Dividend Payments

Although inflation slightly declined from the 40-year high level in July, the 8.5% CPI level is still ‘uncomfortably high’ for policymakers. Moreover, the U.S. economy witnessed two consecutive quarters of economic contraction.

To achieve its long-term target of 2% inflation, the Federal Reserve Chairman has indicated that the central bank will use the monetary policy measures at its disposal, including aggressive interest rate hikes. The Fed’s hawkish stance is expected to keep the market under pressure in the upcoming months.

Therefore, investing in high dividend-paying stocks could help investors cushion their portfolios against market uncertainty by generating a steady income stream. Given their decades-long history of consistent dividend payments, Johnson & Johnson (JNJ), AbbVie Inc. (ABBV), and Becton, Dickinson and Company (BDX) could be ideal investments now.

Johnson & Johnson (JNJ)

JNJ is engaged in research and development, manufacturing, and selling healthcare products, primarily focused on human health and well-being. The company operates through three segments: Consumer, Pharmaceutical, and Medical Devices. It offers its products to the general public, retail outlets and distributors, wholesalers, hospitals, and healthcare professionals.

JNJ’s four-year average dividend yield is 2.60%, and its current dividend translates to a 2.73% yield. Its dividends have grown at a 5.8% CAGR over the past three years and a 5.9% CAGR over the past five years. The company has been paying dividends for 59 consecutive years.

On August 24, 2022, the company received the FDA’s approval for IMBRUVICA® (ibrutinib) for treating pediatric patients with chronic graft-versus-host disease (cGVHD). With this approval, IMBRUVICA became the first FDA-approved therapy for patients with a life-threatening illness. Susan Stewart, Executive Director of BMT InfoNet, said, “The FDA approval of IMBRUVICA puts another weapon in their arsenal and has the potential to truly make a difference for those who are faced with this challenging disease.”

During the fiscal second quarter (ended June 30, 2022), JNJ’s net sales increased 3% year-over-year to $24.02 billion. Its gross profit rose 2.4% from the year-ago value to $16.10 billion. The company’s non-GAAP net earnings grew 4.3% from the same period last year to $6.91 billion, while its adjusted EPS came in at $2.59, representing a 4.4% increase year-over-year.

Analysts expect JNJ’s revenues to increase marginally year-over-year to $23.59 billion for the fiscal third quarter (ending September 30, 2022). Its EPS is expected to increase 6.7% to $2.27 in the next quarter ending December 31, 2022. The company has surpassed the consensus EPS estimates in each of the trailing four quarters, which is excellent.

The stock has gained 4.6% over the past nine months to close the last trading session at $165.34.

JNJ’s strong fundamentals are reflected in its POWR Ratings. The stock has an overall rating of A, which equates to a Strong Buy in our POWR Ratings system. The POWR Ratings are calculated by considering 118 different factors, with each factor weighted to an optimal degree.

JNJ also has an A grade for Stability and a B for Growth, Value, Sentiment, and Quality. The stock is ranked first of 167 stocks in the Medical - Pharmaceuticals industry. Click here to see the JNJ’s rating for Momentum.

AbbVie Inc. (ABBV)

ABBV is engaged in developing, manufacturing, and selling pharmaceuticals globally. It offers its products in various categories: immunology, oncology, neuroscience, eye care, and women's healthcare. The company markets its products to wholesalers, distributors, government agencies, health care facilities, and independent retailers.

ABBV’s four-year average dividend yield is 4.64%, and its current dividend translates to a 4.1% yield. Its dividends have grown at a 9.9% CAGR over the past three years and 17.5% CAGR over the past five years. ABBV is a member of the S&P Dividend Aristocrats Index, which tracks companies that have annually increased their dividend for at least 25 consecutive years.

On July 26, 2022, the European Commission approved the company’s RINVOQ (upadacitinib) for treating adults with moderate to severe ulcerative colitis who have had an inadequate response and lost response or were intolerant to either conventional therapy or a biologic agent. This approval should strengthen ABBV’s ability to treat patients with ulcerative colitis.

ABBV’s net revenues increased 4.5% year-over-year to $14.58 billion in the second quarter that ended June 30, 2022. The company’s non-GAAP net earnings increased 10.7% from the year-ago value to $6.06 billion, while its adjusted EPS rose 11.2% from the prior-year quarter to $3.37.

Analysts expect ABBV’s EPS and revenue to increase 8.1% and 4.5% year-over-year to $3.60 and $14.99 billion, respectively, in the fiscal third quarter ending September 30, 2022. It has surpassed the Street EPS estimates in each of the trailing four quarters. ABBV has gained 23.3% over the past year to close the last trading session at $138.45.

ABBV’s strong fundamentals are reflected in its POWR Ratings. The company has an overall rating of A, which translates to a Strong Buy in our proprietary rating system.

It has an A grade for Quality and a B for Growth, Value, and Sentiment. Within the same industry, it is ranked #4. To see the other ratings of ABBV for Momentum and Stability, click here.

Becton, Dickinson and Company (BDX)

BDX is engaged in developing, manufacturing, and selling a range of medical supplies, devices, laboratory equipment, and diagnostic products. The company operates through three business segments: BD Medical, BD Life Sciences, and BD Interventional.

BDX’s four-year average dividend yield is 1.28%, and its forward annual dividend of $3.48 translates to a 1.36% yield. Its dividends have grown at 4.2% and 4% CAGRs over the past three and five years. BDX has been paying dividends for 49 consecutive years.

On August 09, 2022, BDX collaborated with Laboratory Corp. of America Holdings (LH), a leading global life sciences company, to develop flow cytometry-based companion diagnostics for matching patients with treatments.

LH’s chief scientific officer, Dr. Bill Hanlon, said, "Flow cytometry is a trusted and powerful tool for analyzing cells to better understand disease, and it has tremendous untapped potential as a companion diagnostic in oncology and other therapeutic areas."

Analysts expect the combined capabilities of both companies to advance flow cytometry as an essential companion diagnostic modality for cancer and other diseases.

For the fiscal third quarter ended June 30, 2022, BDX’s revenues increased marginally year-over-year to $4.64 billion. The company’s operating income came in at $537 million, up 9.1% from the prior-year period, while its adjusted EPS rose 16.7% year-over-year to $2.66.

For the fourth quarter, ending September 30, 2022, BDX’s EPS is expected to increase 5.8% year-over-year to $2.74. Its revenue is expected to increase 2.9% year-over-year to $19.40 billion for fiscal 2023. BDX has surpassed Street EPS estimates in each of the trailing four quarters. Over the past nine months, the stock has gained 8.3% to close the last trading session at $255.25.

BDX’s POWR Ratings reflect this promising outlook. The stock has an overall rating of B, which equates to a Buy in our proprietary rating system.

It has a B grade for Growth, Stability, and Sentiment. Among the 144 stocks in the Medical - Devices & Equipment industry, it is ranked #32. Click here to see the other ratings of BDX for Value, Momentum, and Quality.

JNJ shares were trading at $164.37 per share on Friday afternoon, down $0.97 (-0.59%). Year-to-date, JNJ has declined -2.02%, versus a -16.10% rise in the benchmark S&P 500 index during the same period.

Shweta's profound interest in financial research and quantitative analysis led her to pursue a career as an investment analyst. She uses her knowledge to help retail investors make educated investment decisions.

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