Two Reliable Dividend Stocks to Build a Foundation
When it comes to dividend stocks, finding those that are truly reliable can be a challenge. However, there are some exceptional companies that have consistently delivered on their promises and have become essential components of many portfolios.
Two such companies are Johnson & Johnson (JNJ) and AbbVie (ABBV), both of which have been paying dividends for decades and have demonstrated an ability to generate strong cash flows, even in uncertain markets.
Johnson & Johnson has a long history of dividend payments, having increased its dividend annually for 64 straight years. It currently pays out a $1.34 per share quarterly dividend at an above-average yield of 1.96%. The company's pharmaceutical business grew revenue by 7.8% year over year to $16.4 billion in the most recent quarter, while its medtech business increased revenue by 4.5% to $8.9 billion.
AbbVie is another Dividend King, with a history of annual dividend increases dating back to 1968. It currently pays out a $1.73 per share quarterly dividend at a yield of 2.6%. The company's revenue grew by 10% year over year to about $17 billion in the most recent quarter.
Both companies have demonstrated an ability to generate strong cash flows and have been solid performers, with five-year average annualized returns of 12% (JNJ) and 22.1% (ABBV), and 10-year average annualized returns of 11.5% (JNJ) and 19.6% (ABBV).