Equities haven't performed well this year due to a combination of factors. Macroeconomic tensions are at the top of that list. Still, some companies are doing just fine amid the volatility, including AbbVie (ABBV 2.24%) and Abbott Laboratories (ABT 0.84%). These two healthcare leaders may or may not continue beating the market in the next few weeks -- it's challenging to predict the direction of any single stock or the broader equities in such a short period.
However, no matter what happens in the near term, AbbVie and Abbott Laboratories are excellent long-term picks for dividend-focused investors. Here's why.
NYSE: ABBV
Key Data Points
1. AbbVie
AbbVie's shares dropped off a cliff in November after it announced a clinical setback for emraclidine, an investigational schizophrenia treatment it got in an $8.7 billion acquisition. Investors were worried the company spent nearly $9 billion for nothing, which is understandable.
However, AbbVie's shares have been on a tear since that dip, and it has maintained that momentum through 2025, at least so far. Though the emraclidine setback was concerning news, AbbVie still has excellent prospects that didn't warrant the significant drop. The company's financial results remain strong despite losing patent exclusivity for one of the most lucrative therapies ever, Humira, about two years ago.
In 2024, AbbVie's revenue totaled $56.3 billion, up 3.7% year over year. That's a bit below what's considered strong top-line growth for a pharmaceutical giant, but considering the still (relatively) fresh Humira patent cliff, it's rather impressive that the drugmaker's sales are moving north. AbbVie's lineup of approved products is excellent, from its immunology medicines Skyrizi and Rinvoq to its Botox, for which we are unlikely to see biosimilars, as management argued some years ago, and newer products like migraine treatment Qulipta.
Clinical disappointments and patent cliffs will happen, but AbbVie looks ready to handle them all. The company's pipeline has several dozen programs. AbbVie recently penned a deal with a Denmark-based company, Gubra A/S, to develop an investigational weight loss therapy, an area that has caught fire in recent years. AbbVie's efforts in this field may or may not pay off, but the company's solid pipeline will likely yield more blockbusters to replace its current medicines, which are still driving top-line growth.
Lastly, AbbVie is a Dividend King when we count the time it spent as a division of Abbott Laboratories -- it is on a streak of 53 consecutive years of payout increases. And since splitting from Abbott, AbbVie has increased its dividends by 310%. The stock offers a forward yield of 3.1%, well above the S&P 500 index's average of 1.3%. Whether or not AbbVie's shares keep performing well this year, the company is a strong forever dividend stock to buy.
NYSE: ABT
Key Data Points
2. Abbott Laboratories
Abbott Laboratories is a healthcare company that operates in the medical device, nutrition, pharmaceutical, and diagnostic areas. The company is a leader in several markets where it does business. Its infant formula brand Similac is well known. During the worst of the pandemic, Abbott Laboratories marketed some of the top coronavirus diagnostic tests. Within its medical device segment, Abbott's franchise of continuous glucose monitoring (CGM) systems, the FreeStyle Libre, is the most successful device ever in sales.
None of this happens by accident. Abbott Laboratories has fostered a culture of innovation in the many decades it has been around. It also has significant footprints and expertise navigating the challenging and highly regulated healthcare industry. Abbott Laboratories will rarely blow investors out of the water with skyrocketing revenue, but we can expect steady, reliable financial results from the company. That's what it has offered for a long time.
ABT Revenue (Annual) data by YCharts
Abbott Laboratories should be able to profit from long-term tailwinds to continue doing the same. The company's FreeStyle Libre, its best growth driver, still has miles of whitespace to exploit, considering that as of last year, only 1% of adults with diabetes worldwide used CGM technology. Abbott's other medical device units, including structural heart and heart failure, offer innovative products whose demand will increase over time, given the world's aging population.
Abbott Laboratories should deliver excellent returns in the long run while growing its payouts annually, just as it has for the past 53 straight years. Abbott's forward yield of 1.9% might not be that impressive, but its underlying business, growth prospects, and track record all scream that it is an excellent buy-and-forget option for income seekers.
