The market has given investors a lot of ups and downs over the past year, and we don’t know exactly when the volatility will end. Luckily, as a long-term investor, you don’t have to adapt your investment decisions to the whims of the market. Rather, we will continue to invest in all market conditions by concentrating our capital in high-quality companies with a proven track record of growth and strong pathways to future growth, thereby significantly enhancing portfolio returns over the long term. I can.
Here are the top three high-dividend stocks you might want to consider adding to your portfolio before the end of the year.
As a member of the illustrious Dividend Kings Club, AbbVie (ABBV -1.07%) Most income stocks have payout histories that are comparable. Currently, the stock-based yield is 3.6%, which is almost double the yield of the average stock traded in the United States. S&P 500Meanwhile, AbbVie’s dividend has increased by about 270% over the past decade, providing investors with a total return of about 650%.
The company boasts a broad portfolio of products that generate consistent demand, including medicines for various immunological, oncological and neurological disorders. It also has a rapidly growing portfolio of aesthetic products. Best known for his two acquisitions in 2020, Botox Cosmetic and Botox Therapeutic, which he acquired in the Allergan acquisition.
Humira, recognized as the world’s best-selling medicine, has been a growth driver for AbbVie for many years. But the company has long paved the way for growth beyond Humira’s blockbuster status by pioneering its pipeline, launching new drugs and making targeted acquisitions. The Allergan acquisition expanded its footprint in the aesthetic medicine market, while AbbVie’s acquisitions of UK-based biotech DJS Antibodies and Belgian biotech Syndesi Therapeutics earlier this year boosted its immunology and neuroscience portfolio. has expanded significantly.
Even if Humira’s exclusive patent expires in the United States in 2023, AbbVie has many other products that are expected to drive long-term future growth. For example, Skyrizi and Rinvoq, the top-selling immunization drugs, increased their total revenue by 75% and 54%, respectively, in the third quarter of 2022 compared to the same period in 2021.
Over the last 10 years, AbbVie’s annual revenues and earnings have grown 206% and 120%, respectively. AbbVie’s track record and robust product portfolio bodes well not only for its future growth story, but also for income investors taking long-term positions in this proven healthcare stock.
Target (target -3.22%) It is also a dividend king and has increased its dividend for 51 consecutive years. Meanwhile, the stock’s dividend has increased by 200% over the past decade, giving him a total return of 223%. Target currently boasts a yield of 2.8%.
Admittedly, it’s been a bumpy road lately for Target’s shareholders. After accumulating excess inventory early in the pandemic, Target’s revenue and margins took a severe hit in recent quarters as the company worked to remove this excess inventory of merchandise.
Consumer spending surged a few years ago, but as the pandemic recovery changed the macro environment and consumers curtailed spending, many businesses found themselves with too much inventory on hand. Target was no exception. High inflation also continues to weigh on consumer spending. All of these factors have created pain for Target’s balance sheet and investors, but these are short-term dynamics, not permanent headwinds to the business.
Target had already begun to see progress from its aggressive inventory offload plans in the most recent quarter. Total revenue increased 3% year-over-year to $26.5 billion, and operating margin improved from 1.2% in the second quarter to 4% in the third quarter. Both net income and operating income were down from the prior year, but still totaled $712 million and $1 billion, respectively.
Remember, this follows revenue and profit growth of 45% and 132% over the last decade. Target boasts a diverse business that covers a variety of product categories, from everyday essentials to discretionary items. For investors with the patience to wait for imminent environmental volatility, the diversity of Target’s established businesses can yield significant long-term returns.
3. Colgate Palmolive
household name Colgate Palmolive (CL -1.84%) It is also a dividend king, and has continued to increase its dividend for 59 consecutive years. The stock yields about 2.4% at the time of this writing. The stock hasn’t performed particularly well in recent years, but over the past decade, loyal investors have seen dividends increase by more than 50% of his.
No consumer-centric stock is immune to inflation, but Colgate-Palmolive has more options than most stocks due to the inherent nature of thousands of branded products. In addition to Colgate and Palmolive, we also sell a variety of well-known brands such as Tom’s of Maine, Ajax, Axion, Speed Stick, Protex and Hill’s Pet Nutrition. From oral care to personal care to pet care, people will continue to buy these products regardless of what’s happening to the economy.
Given the company’s 216-year history, it’s clear that this isn’t Colgate-Palmolive’s first rodeo. Foreign exchange fluctuations and inflationary factors, both short-term and non-business-related headwinds, which raise the cost of doing business, impacted the company’s sales and earnings in the most recent quarter. However, three-month net income he reportedly reached $618 million, with organic sales up 7% year-over-year to reach $4.5 billion.
The nature of Colgate-Palmolive’s business and the products it sells are not conducive to lightning-quick growth quarter-over-quarter or even year-over-year. Still, in the last five years alone, the company has increased annual revenue and annual net income by 13% and 7%, respectively. For income investors looking to add stable-growth blue chip stocks to a well-diversified portfolio, Colgate-Palmolive certainly fits the bill on both fronts.