There's nothing quite like making money while you sleep. And investing in dividend stocks is a great way to do that. However, with so many dividend payers, it can be hard to know which one to pick.
If you want passive dividend income for decades, it's important to pick dividend-paying companies that are unlikely to run into issues that will force them to suspend their dividend programs. Let's consider two stocks that fit the bill: Abbott Laboratories (ABT 0.23%) and Medtronic (MDT +1.99%).
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Boring sometimes gets the job done
Abbott Laboratories and Medtronic are among the largest medical device specialists. These aren't the best stocks to capitalize on the rapidly growing field of artificial intelligence or some other exciting tech trend, but what they lack in hype they make up for with steady, reliable businesses. Take Abbott Laboratories, whose businesses span medical devices, nutrition, pharmaceuticals, and diagnostics. The company has a large product portfolio, including some of the market leaders in its categories, particularly in its diabetes care unit and structural heart segment.
Abbott Laboratories' franchise of continuous glucose monitoring (CGM) systems, the FreeStyle Libre, is among the best in its class. The company's MitraClip was a significant breakthrough in its field, advancing a minimally invasive approach to treating mitral valve regurgitation. And there are many more examples. Abbott Laboratories records consistent revenue and earnings, and has important long-term growth opportunities, particularly with its FreeStyle Libre.
NYSE: ABT
Key Data Points
Medtronic also boasts a deep lineup across several therapeutic areas. The company's breakthroughs have been helping it generate strong financial results recently. The company helped pioneer pulse field ablation technology, a relatively new technology to help treat some heart-related problems. The company's launches in this niche helped power strong revenue growth last year. It is also entering the robotic-assisted surgery market through the Hugo system, which received U.S. Food and Drug Administration clearance in December for urologic procedures.
Medtronic and Abbott Laboratories have businesses that tend to withstand economic troubles, while their innovative abilities and deep portfolios mean they are consistently launching new products and generating higher revenue and earnings, all qualities we want in dividend stocks.
NYSE: MDT
Key Data Points
Impressive dividend track records
Will either Abbott Laboratories or Medtronic cut their dividends anytime soon? That seems unlikely. The latter is a Dividend King, that is, a company with at least 50 consecutive years of dividend increases. That's a fantastic streak, and it highlights the strength of Abbott Laboratories' business. This is one of the safer dividend programs on the market. Medtronic isn't quite as impressive, but it isn't that far behind either. The healthcare giant has posted 48 consecutive years of dividend hikes and should join the ranks of Dividend Kings within a couple of years.
This provides further proof that Medtronic, as well as Abbott Laboratories, can deliver consistent, growing dividends for decades.
