Pfizer vs. Annaly Capital Management: Which Dividend Stock Is Better?

In the spirit of World Cup competition, we're holding our own tournament in search of the Better Stock Today. We're pitting 32 companies against each other, and you, the reader, will determine the winner.

Today it's the round of 16, and Pfizer takes on Annaly Capital Management in our search for the better stock today.

David Williamson, Motley Fool health-care analyst, thinks Pfizer (NYSE: PFE  ) should advance to the next round because of one big reason -- it isn't afraid to think big. Pfizer has gone through a radical transformation: gone are the nutrition and animal health businesses, and off-patent drugs may be next. Pfizer was unable to pull off a merger with AstraZeneca to dramatically lower its tax rate, but that doesn't mean its financial engineering is done. Expect Pfizer to spend the money on shareholder-friendly actions including increasing its dividend and ramping up share buybacks.

Financials analyst David Hanson believes the No. 1 reason Annaly Capital Management (NYSE: NLY  ) should win this match is the company's dirt-cheap valuation. Shares of Annaly have rarely been this cheap in the company's very successful history, and management's recent push into the commercial real estate space should allow its portfolio to achieve higher yields without much additional leverage. The ride isn't likely to be smooth, but long-term investors can collect hefty dividends along the way as the company finds better-yielding opportunities. 

Top dividend stocks for the next decade
The smartest investors know that dividend stocks simply crush their non-dividend paying counterparts over the long term. That's beyond dispute. They also know that a well-constructed dividend portfolio creates wealth steadily, while still allowing you to sleep like a baby. Knowing how valuable such a portfolio might be, our top analysts put together a report on a group of high-yielding stocks that should be in any income investor's portfolio. To see our free report on these stocks, just click here now.

Vote here to determine the winner of this match and sound off in the comments. Check back to Fool.com to see who advances in the tournament.


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  • Report this Comment On June 20, 2014, at 5:42 PM, plange01 wrote:

    nly by far

  • Report this Comment On June 22, 2014, at 10:14 PM, MikieDB wrote:

    PFE is ready to boost the dividend and has made a good move to reduce it's tax load. They have the cash reserves to buy some good new products available now. Rising interest rates could be a game changer for NLY and cause a lower yield.

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