Better Dividend: GlaxoSmithKline vs. AbbVie

Two of big pharma's best stocks offer high-yielding dividends, but is GlaxoSmithKline or AbbVie better for your long-term portfolio?

Mar 13, 2014 at 2:30PM

Big pharma's one of the best industries for investors hungry for high-yielding dividends. Some of the biggest stocks in this sector offer great dividends and stable cash flows, and both GlaxoSmithKline (NYSE:GSK) and AbbVie (NYSE:ABBV) rank among the top names in the industry. Glaxo's 5.4% dividend yield, in particular, is one of the best dividend draws among pharma stocks, but is that enough to recommend this stock over AbbVie for income investors?

Glaxo is coming off the fallout of its China scandal last year that cost the company dearly in the third quarter. However, Glaxo's pipeline is loaded for the long term, and the company is even optimistic about its future in China and other emerging markets. AbbVie, on the other hand, is all-in behind leading drug Humira, the immunology blockbuster that makes up nearly 60% of the company's total sales. While that reliance on one drug looks dangerous, Humira, as a biologic, won't be easily replicated in biosimilar form once its patent protection expires in 2016 -- and AbbVie is already looking to the future with its unnamed oral hepatitis C drug, which it hopes to launch at the end of the year pending regulatory approval.

Are Humira and the promises of the oral hep C market enough to make AbbVie your top dividend stock for the future, or is Glaxo's high yield and impressive pipeline the right choice? Find out in the video below, as Motley Fool contributor Dan Carroll takes you through where each of these blue-chip big pharma stocks is headed and which one's dividend looks the best for the long term.

How dividend stocks like Glaxo and AbbVie can make you rich
Why are great dividend stocks such as big pharma's best so valuable to your financial future? One of the dirty secrets that few finance professionals will openly admit is the fact that dividend stocks as a group handily outperform their non-dividend-paying brethren. However, knowing this is only half the battle. The other half is identifying which dividend stocks in particular are the best. With this in mind, our top analysts put together a free list of nine high-yielding stocks that should be in every income investor's portfolio. To learn the identity of these stocks instantly and for free, all you have to do is click here now.

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Dan Carroll has no position in any stocks mentioned. The Motley Fool recommends Gilead Sciences. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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