It's smart to seek dividend income from your investments because it can be used to help pay living expenses or to buy more stock. A solid dividend-paying stock to consider is pharmaceutical company AbbVie (ABBV +0.17%), which was spun off from Abbott Laboratories in 2013. The stock recently sported a 3.38% dividend yield, far above the average yield of 1.1% for stocks in the S&P 500.
If you're looking for, say, $10,000 in annual dividend income, how many shares of AbbVie do you need to buy?
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Well, start by noting that the company's last quarterly dividend payment was $1.73 per share. The yearly run rate, then, is $6.92 per share. So divide $10,000 by $6.92, and you'll get 1,445 -- the number of shares you'd need. With the stock recently trading around $205 per share (as of March 24), those 1,445 shares would cost you a hefty $296,225. (Fortunately, you can always buy fewer than 1,445 shares!)
NYSE: ABBV
Key Data Points
One reason to consider investing in AbbVie is that it's a rather reliable dividend payer -- and dividend grower. Since 2013, it has upped its payout by more than 330%. Better still, when you combine its history with that of Abbott Labs, you'll see that it has increased its payout annually for more than 25 years. So the $10,000 (or other sum) that you collect in dividends this year could be much more after a few years.
The dividend is not the only reason to consider AbbVie. It's a strong grower in general, with its stock averaging annual gains of 16.2% over the past decade. Its 2025 revenue was up 8.6% over the year before -- despite its having lost patent protection for its blockbuster drug, Humira. Its pipeline of 90-plus drugs in development is promising, too.
AbbVie's stock is reasonably priced, with a recent forward-looking price-to-earnings (P/E) ratio of 14, a bit above the five-year average of 13.
