3 Unstoppable Dividend Stocks to Buy in September

When it comes to finding a great dividend stock to add to your investment portfolio, there's a wide variety of stocks to choose from. Some, for instance, have stronger underlying businesses than others.

We asked three Motley Fool contributors to pick unstoppable dividend stocks to buy in September. They chose Abbott Laboratories (ABT -0.59%), AbbVie (ABBV 0.25%), and Gilead Sciences (GILD -1.15%). Here's why.

1. Abbott Laboratories: Plenty of growth opportunities

David Jagielski: In June, dividend stalwart Abbott Laboratories announced it was paying a dividend for the 394th quarter in a row. That means Abbott's streak of paying quarterly dividends goes back to 1924. It's six quarters away from hitting the 100-year mark.

At first glance, the healthcare company's dividend yield of 1.8% may look humdrum given that the S&P 500 average yield is 1.7%. What gives Abbott an edge as a dividend stock is that it has an exceptional record of regularly increasing its dividend payments. It has raised its payouts annually for 50 years in a row, qualifying it for Dividend King status. Its current quarterly payment is 77% higher than five years ago, making it a top dividend growth stock to own. With a payout ratio of less than 40%, the company clearly has the free cash flow to safely cover the current payout as well as enough to continue increasing its dividend in the years ahead.

That stability is because the business itself is solid and diversified. The company generates revenue from a variety of sources, including diagnostics, medical devices, nutritional products, and pharmaceuticals. Whether it's the COVID-19 pandemic and the need for testing, the need for its devices to help patients manage diabetes, or its baby formula products, Abbott's business is both safe and full of growth opportunities given its diverse mix of products. 

Investors shouldn't assume that Abbott can't grow without COVID-19 tests propping up its numbers. For the three-month period ending June 30, the company reported organic sales growth of 4.1% excluding COVID-19 testing revenue. Abbott's business isn't overly dependent on one area. The company's strength and potential growth opportunities make Abbott an underrated dividend stock.

2. AbbVie: More revenue-generating drugs in the pipeline

Keith Speights: This September pick shares a lot in common with Abbott Labs. Prior to 2013, AbbVie was part of Abbott. Since the spin-off, AbbVie has delivered an even more impressive dividend track record than its parent. The big drugmaker has boosted its dividend by more than 250%, and its dividend yield currently tops 4%.

But AbbVie offers more to investors than just its dividend. The stock has also delivered significant appreciation, with share prices nearly quadrupling over the past 10 years. Even though AbbVie stock hasn't been quite as hot so far in 2022, it's still easily beating the S&P 500's performance.

AbbVie has what it takes to beat the market over the next 10 years, too. Granted, the company faces biosimilar competition in the U.S. market for its Humira drug beginning in 2023. That's problematic since the autoimmune-disease fighter generated around 37% of AbbVie's total revenue in the second quarter of 2022.

However, the company has other products that can offset the anticipated sales decline for Humira. In particular, AbbVie thinks that newer autoimmune-disease drugs Rinvoq and Skyrizi will together generate peak sales even higher than Humira has. The big drugmaker also has other potential growth drivers. Antipsychotic medication Vraylar, blood cancer drug Venclexta, and migraine drugs Qlipta and Ubrelvy especially stand out.

3. Gilead Sciences: A resilient biotech giant 

Prosper Junior Bakiny: Gilead Sciences has faced a series of regulatory-related adversities in the past three years. The company was counting on beefing up its lineup with key new approvals, but things haven't gone according to plan. Thankfully, Gilead has still been able to deliver decent financial results, partly thanks to its coronavirus medicine, Veklury. 

While Gilead Sciences' lineup isn't what the company hoped it would be, that hasn't stopped the drugmaker from continuing to hike its dividends. Just in the past three years, the company's payouts have jumped by 15.9% -- an annual average of more than 5%. That ability to increase payouts even amid company-specific and worldwide economic troubles is one of the marks of an outstanding dividend stock. 

Thankfully, Gilead's future looks better. For instance, the company remains a leader in the HIV drug market. In the second quarter, Biktarvy grew its market share by four percentage points year over year to 44%. Meanwhile, Gilead's Descovy also held a 44% share of the HIV prep market as of the second quarter, although its slice of the pie dropped by about 1 percentage point year over year due to generic competition.

Further, Gilead Sciences should strengthen its prescription drug portfolio. Last month, it earned approval in Europe for Sunlenca, a six-month, long-lasting HIV treatment (the first of its kind). The U.S. Food and Drug Administration (FDA) declined to grant the green light to this product back in March due to manufacturing issues. Gilead Sciences has since resolved the FDA's issues and reissued an application.

Gilead Sciences has many more HIV-related products coming through the pipeline. The company hopes to make bigger waves within the oncology market too. Despite recent troubles, Gilead should continue delivering solid financial results. With an above-average dividend yield of 4.5% and a very manageable cash payout ratio of 39%, this biotech stock appears to be a great dividend pick in September.