Equities are down this year because of Donald Trump's trade policies. The 47th U.S. president decided to impose steep tariffs on imported goods from most countries, although he has since significantly rolled back -- or at least paused -- these plans.
Amid all the volatility, some companies are proving resilient by performing much better than the market. Some of these look like excellent buy-and-hold options, especially for income-seeking investors. Let's consider two such corporations: Amgen (AMGN +0.51%) and Novartis (NVS 0.55%).
NASDAQ: AMGN
Key Data Points
1. Amgen
Although President Trump has spared the pharmaceutical industry from tariffs for now, his administration has indicated that could change soon. That means drugmakers like Amgen might see a meaningful effect on their bottom line. According to some CEOs in the industry, tariffs could even lead to less innovation in the field. Still, developing lifesaving drugs is a business that will never be out of style, regardless of economic conditions.
Drugmakers that can adapt will likely perform well in the long run. Amgen is one of them. The biotech has a long list of approved medicines across multiple therapeutic areas. Last year, it had 13 products that generated at least $1 billion in annual sales. Most of these saw their sales move in the right direction.
Amgen boasts several exciting growth drivers. Tepezza remains the only therapy approved by the U.S. Food and Drug Administration (FDA) for thyroid eye disease.The biotech is aiming for regulatory approvals for this medicine in other countries, which will help boost its sales.
Amgen's therapy for asthma, Tezspire, co-marketed with AstraZeneca, is also performing well and continues to record important clinical wins that will lead to label expansions. Older drugs such as Repatha for high cholesterol and Evenity, used to treat the bone disease osteoporosis in post-menopausal women, are still among Amgen's best performers.
Lastly, the company has a deep pipeline. Despite phase 2 data for its weight management candidate, MariTide, that failed to impress, this investigational medicine could still go on to carve out a solid niche in the fast-growing weight loss market. Amgen has plenty of other exciting programs in the pipeline.
Amid all the economic issues we have experienced in the past five years, the biotech has continued to increase its dividends. Amgen's payouts have grown by 201% in the past decade, and it offers a forward yield of 3.2% at Wednesday's prices.
Amgen's strong presence in a defensive industry, excellent innovative track record, and strong dividend program make it a top stock to hold on to for good.
NYSE: NVS
Key Data Points
2. Novartis
Novartis is already planning to get around any tariffs imposed on the pharmaceutical industry. The drugmaker recently announced a five-year, $23 billion manufacturing project in the U.S. This move could help in the long run, but it especially highlights an important point about massively successful corporations: They have the financial flexibility to adapt to changing economic conditions. Novartis owes that to its solid underlying operations. Its top-line growth rarely blows investors away, but it records steady revenue and profits.
In today's volatile environment, slow and steady might be what the doctor ordered. True, Novartis will face some patent cliffs this year, none more critical than Entresto, a heart failure medicine that is the company's top-selling drug. Novartis' revenue might drop once that happens, as it typically does for any drugmaker that loses patent exclusivity for its best-selling product.
However, Novartis should be able to move past it. The company has several newer growth drivers that will gain prominence. Fabhalta, a therapy for a rare blood disease, earned the green light in 2023, while Vanrafia, a medicine for a kidney disease, did so just this month. Novartis' deep pipeline will lead to more approvals down the line. The company's dividend track record speaks volumes about its ability to navigate challenging conditions. Novartis has increased its payouts for 28 consecutive years.
The company also offers a dividend yield of 3.5%. Whether it's for stability or income, Novartis is a great forever pick for investors.
