The Health Care Sector includes organizations specializing in hospital management, health maintenance organizations (HMOs), biotechnology and medical products. Stocks in these companies are often considered defensive due to a consistent demand for their goods and services. Thus, this sector is less sensitive to economic cycles.
One surety in life is that we will continue to age until we die. As we age, our heath eventually begins to decline. Unfortunately, the Health Care Sector will never become obsolete. However, understanding this provides us with investment opportunities in quality dividend growth stocks.
This week, I screened my dividend growth stocks database for health care companies with a yield at or above 2% and have increased their dividends for at least 10 consecutive years. The results are presented below:
Medtronic Inc. (MDT) is a global medical device manufacturer with leadership positions in the pacemaker, defibrillator, orthopedic, diabetes management and other medical markets. The company has paid a cash dividend to shareholders every year since 1977 and has increased its dividend payments for 36 consecutive years. Yield: 2.1%
Mine Safety Appliances Co. (MSA) develops, manufactures and supplies products that protect people's health and safety. Products include self-contained breathing apparatus and gas masks. The company has paid a cash dividend to shareholders every year since 1918 and has increased its dividend payments for 42 consecutive years. Yield: 2.3%
Cardinal Health Inc. (CAH) is one of the leading wholesale distributors of pharmaceuticals, medical/surgical supplies and related products to a broad range of health care customers. The company has paid a cash dividend to shareholders every year since 1983 and has increased its dividend payments for 17 consecutive years. Yield: 2.3%
Owens & Minor Inc. (OMI) is a leading domestic distributor of medical and surgical supplies to the acute care market, a health care supply chain management company, and a direct-to-consumer (DTC) supplier of testing and monitoring supplies for diabetes. The company has paid a cash dividend to shareholders every year since 1926 and has increased its dividend payments for 15 consecutive years. Yield: 2.8%
Johnson & Johnson (JNJ) is a leader in the pharmaceutical, medical device and consumer products industries. The company has paid a cash dividend to shareholders every year since 1944 and has increased its dividend payments for 51 consecutive years. Yield: 3.0%
Abbvie Inc. (ABBV) is a global research-based pharmaceuticals business that emerged as a separate entity following its spin-off from Abbott Laboratories at the start of 2013. AbbVie's key drug is Humira for rheumatoid arthritis. The company has paid a cash dividend to shareholders every year since 1926 and has increased its dividend payments for 40 consecutive years. Yield: 3.6%
As with past screens, the data presented above is in its raw form. Some of the the companies would be disqualified for poor dividend fundamentals. However some of the others may be worth additional due diligence.
My database, D4L-Data, is an Open Office spreadsheet containing more than 20 columns of information on the 230+ companies that I track. The data is sortable and has built-in buttons and macros to make it easy to use. Companies included in the list are those that have had a history of dividend growth. The D4L-Data spreadsheet is a part of D4L-Premium Services and is updated each Saturday for subscribers.
Full Disclosure: Long OMI, JNJ, ABBV in my Dividend Growth Portfolio. See a list of all my dividend growth holdings here.
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