Stock Market Highlights: Strong Dividend Stocks Shine

A recent report highlights a significant bull run in the stock market, with the S&P 500 rising 57.1% since late 2022. Amid this, several high-yield dividend stocks like Brookfield Infrastructure, AbbVie, and Royalty Pharma show promise for investors seeking income and growth.

Date: 03-12-2024

AI Rating: 6

The report highlights a robust performance of the S&P 500, with a remarkable 57.1% rise since the end of 2022 until Nov. 29. However, it notes that stock prices have surged beyond the growth in underlying earnings of businesses, resulting in a low average dividend yield of 1.2% in the S&P 500.

For income-seeking investors, the report identifies three stocks offering attractive yields above 3%:

1. Brookfield Infrastructure (BIP)

The report indicates that Brookfield Infrastructure increased its quarterly dividend payout by 6%, marking its 15th consecutive year of dividend raises, with funds from operations reaching $2.31 per share. This shows strong profitability and a sustainable ability to support its current payout of $1.62 per share annually.

2. AbbVie (ABBV)

AbbVie is portrayed as a strong dividend payer with a yield of 3.6%. However, it faces challenges due to a significant drop in sales for its drug Humira, which saw a 34% decrease. In contrast, AbbVie has successfully offset some losses through revenue growth from newer products like Skyrizi, which rose 48% year over year. This indicates an ability to adapt and potential future growth despite current headwinds.

3. Royalty Pharma (RPRX)

With a dividend yield of 3.6%, Royalty Pharma's recent 5% dividend increase appears sustainable given the performance of its underlying assets. It anticipates substantial investments in the coming years, which could bolster its long-term growth.

Overall, while the dividend yields of the highlighted stocks appear attractive, investors should be aware of the market dynamics affecting these companies. Brookfield Infrastructure presents a positive outlook with a solid dividend growth history, while AbbVie is currently navigating through revenue challenges but shows potential with new products. Royalty Pharma seems poised for growth by increasing its investment in the pharmaceutical space.

Stocks: BIP ABBV RPRX