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Grasp the Opportunity for Long-Term Wealth: Two Stocks Worth Investing in Permanently.

Two financial backers grin as they scrutinize a digital display on their home computer.
Two financial backers grin as they scrutinize a digital display on their home computer.

Grasp the Opportunity for Long-Term Wealth: Two Stocks Worth Investing in Permanently.

Investing in stocks often brings to mind thoughts of potential gains or losses. But there's a particular type of stock that could ensure you're a winner year after year, irrespective of market conditions or the stock's performance. I'm talking about the dividend stock. These investments offer a passive income stream, limiting your losses during tough times and boosting your gains during good ones. And the best part? You just need to own shares of dividend-paying companies.

However, just because a company pays dividends now doesn't mean it will continue doing so in the future. But you can be reasonably confident in companies with a history of dividend growth and robust free cash flow. With that in mind, let's explore two dividend stocks that you should consider buying and holding forever.

1. Johnson & Johnson

Johnson & Johnson, a renowned company in the healthcare sector, boasts an impressive track record as a Dividend King. It's increased its dividend for more than 60 consecutive years! With an annual dividend of $4.96 and a dividend yield of 3.3%, Johnson & Johnson outperforms the S&P 500 yield of 1.2%. And with a massive free cash flow of $19 billion, it has the financial strength to uphold these dividend payments.

What's more, the company's future looks promising. In its most recent earnings report, Johnson & Johnson reported a 6% growth across both its pharmaceutical and medical technology businesses, and total sales climbed by more than 5%. Its pharmaceutical division, known as innovative medicine, features 11 top-performing brands that are growing rapidly. Not to mention, the division reported two straight quarters of revenue exceeding $14 billion.

The medical technology segment has experienced significant growth as well, thanks in part to Johnson & Johnson's recent acquisitions of Shockwave and Abiomed. These acquisitions have transformed the company into the market leader in four top cardiovascular intervention markets. In short, Johnson & Johnson's commitment to dividends and its exciting revenue prospects make it an excellent investment for the long term.

2. Abbott Laboratories

Similar to Johnson & Johnson, Abbott Laboratories is also a reliable choice, earning a spot on the Dividend Kings list for its consistent dividend growth. The company offers a $2.36 annual dividend, yielding around 2%. And while it may not top Johnson & Johnson in this regard, it has a free cash flow of $6.4 billion, ensuring its ability to continue its dividend growth trajectory.

During its third-quarter earnings call, CEO Robert Ford expressed commitment to its dividend policy and even approved a $7 billion buyback program, showing its dedication to rewarding shareholders. Abbott is not only a strong healthcare investment but also a company that prioritizes shareholder returns, which makes it a fantastic buy for the long term.

Abbott Laboratories boasts a diversified portfolio, encompassing diagnostics, medical devices, nutrition, and established pharmaceuticals. This diversification assures a certain degree of stability in the earnings picture, making the company more resilient against market fluctuations. In the third quarter, despite a drop in coronavirus testing demand, Abbott was able to offset this by reporting strong revenue growth in its medical device segment.

In conclusion, considering their strong track records and promising future, Johnson & Johnson and Abbott Laboratories are excellent dividend stock choices to consider buying and holding for the long term.

Additionally, smart investors looking to grow their wealth through finance and money should consider these two dividend stocks: Johnson & Johnson and Abbott Laboratories. Both companies have demonstrated a consistent history of dividend growth, with Johnson & Johnson increasing its dividend for over 60 consecutive years and Abbott Laboratories earning a spot on the Dividend Kings list. This commitment to dividends, coupled with robust free cash flow, makes them reliable income sources, even during tough economic times. With promising revenue prospects and a focus on shareholder returns, these stocks are ideal for long-term investing in the finance sector.

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