Current Dividend Yield: 3.8%
Performance So Far in 2012: +17%
Merck apparently has answered one of the big questions about its pipeline, however, judging by a run over the last few weeks. A new osteoporosis drug looks very promising for the drugmaker and investors have piled in, driving up shares about 14% in just a month or so. It’s now triple the Dow Jones average year-to-date in 2012.
Additionally, the continued roll-in of the $41 billion Schering-Plough buyout from a few years ago surely will provide new opportunities for Merck. At the very least, it ensures the company won’t fade away.
And like its cohort Pfizer, MRK is sitting on a huge war chest. Some $13.5 billion in cash and $1.4 billion in short-term investments keeps this pick pretty safe when it comes to writing the checks.
Dividends have been paid at Merck since 1935, and last year the payout was increased about 10%, from 38 cents a quarter to 42 cents. You might not find massive share appreciation in this stock, but you certainly will find stability.
Merck reports July 27.