Top Dividend Stocks #9: Merck (MRK)
Dividend Yield: 3.14%
YTD Performance: +11.95%
52-Week Return: +35.91%
Whereas a number of other dividend stocks on our list have fallen so far this year, Merck (MRK), the global provider of health care products and services, has been on a tear recently. The stock has gained almost 12% year-to-date, far outpacing the major averages and other dividend stocks, and it now carries a dividend yield of 3.1%.
MRK disappointed in its latest quarterly report, but that didn’t seem to matter to the Street. The shares gapped higher even as the company reported earnings per share that missed expectations as well as annual net income that was down almost 29%.
In an effort to streamline their business, Merck announced last month that it intends to sell its consumer brands division. The segment represents only a small portion of MRK’s overall revenues — sales were just $1.9 billion last year — but analysts estimate the deal could be worth as much as $10 billion.
While sales of its leading Singulair allergy and asthma medication have declined significantly since the company lost its exclusivity on the product, investors are more enthused about Merck’s future cancer-treatment and immunotherapy prospects, which should benefit investors, patients and the company alike. However, regardless of what happens in the future, shareholders will be earning an annual payout of $1.76 for their vote of confidence.