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Headlines
- Bristol Myers Squibb: 4.9% Yield and Promising New Treatment
- Dow Inc.: 5.2% Yield with Solid Dividend History
- CVS Health: 4.6% Yield and Strong Long-Term Growth
The S&P 500 index has surged approximately 16% this year. Despite this impressive performance, the dividend yields from many of the index's component stocks have not kept pace with their stock price gains, resulting in an average yield of just 1.3% among dividend payers.
However, several high-yield dividend stocks are still available at attractive prices. Here’s a look at three notable options that stand out for their potential to provide steady returns over the long term:
- Bristol Myers Squibb (~$50 per share)
Bristol Myers Squibb (NYSE:BMY), a major pharmaceutical company, is not impacted by the obesity treatment sector, which has contributed to a modest decline in its stock this year. The company currently offers a substantial 4.9% yield. With a 9% increase in total sales during the second quarter, there’s strong potential for Bristol Myers Squibb to continue its impressive 15-year track record of increasing dividends. Additionally, the company is preparing to market a novel treatment for schizophrenia and other psychotic disorders. The newly acquired KarXT could set a new standard in antipsychotic drugs by offering fewer side effects, pending FDA approval expected next month.
- Dow Inc. (~$54 per share)
Dow Inc. (NYSE:DOW) a leading chemicals manufacturer, offers an attractive 5.2% yield. Despite not having increased its dividend since its spin-off from DuPont in 2019, the company has maintained steady payments, marking its 452nd consecutive quarterly dividend. Although recent macroeconomic conditions have posed challenges, Dow's ability to produce chemicals efficiently gives it a competitive edge. Despite the current downturn in plastic prices in Asia, Dow's cost advantage positions it well for future dividend increases, though these might not be immediate.
- CVS Health (~$59 per share)
Known for its extensive network of retail pharmacies, CVS Health's (NYSE:CVS) core business extends far beyond this, including its 2018 acquisition of the insurer Aetna. The company also operates a significant pharmacy benefits management (PBM) segment, handling 34% of all prescriptions filled last year. CVS Health's stock, which has decreased by about 19% in 2024, currently offers a 4.6% yield. The recent decline is attributed to downward revisions in earnings expectations and new regulatory challenges impacting Medicare Advantage plans. Despite these hurdles, CVS Health's historical dividend growth and comprehensive healthcare operations suggest the likelihood of continued robust dividend increases over the next decade.
