Current Dividend Yield: 3.5%
Performance So Far in 2013: +8%
Big Pharma and dividend investors have been close allies for some time, so it’s no surprise that Pfizer (NYSE:PFE) and its juicy yield are loved by the income crowd.
Pfizer managed to beat out the broader market in 2012, and it’s on pace to do the same in 2013 despite a number of setbacks. Back in August, PFE and Johnson & Johnson (NYSE:JNJ) shut the door on studies of IV-delivered bapineuzumab as an Alzheimer’s treatment, and Lipitor sales have been sliding ever since it went off-patent, welcoming generic competition. Also, in news of the bizarre, Pfizer had to report the theft of $750,000 worth of gold dust at a Chesterfield, Mo., lab.
Still, there’s been some good news thrown into the mix, too. Pfizer recently spun off its animal health division, Zoetis (NYSE:ZTS), in a $2 billion-plus IPO, which should allow the company to focus on its core pharma business. Last fall, the company got a big leukemia drug approval. And while Lipitor sales continued to weigh on corporate results, PFE’s fourth-quarter revenue decline to $15.07 billion still beat analyst estimates, as did earnings, which fell to 47 cents per share.
Going forward, you’ll want to be in healthcare. Drugs are a necessity and don’t play to the whims of a poor economy. Not to mention, healthcare stocks will look even more attractive as America’s baby boomer population ages and requires more treatment. In the meantime, PFE’s dividend — which just got bigger by another 2 cents quarterly a couple weeks ago — will keep your wallet healthy.