This Drug Giant's Dividend Isn't as Scary as It Looks

It's actually one of my favorite stocks! [Shield] AN OXFORD CLUB PUBLICATION Loyal reader since August 2019 [Wealthy Retirement]( [View in browser]( SPONSORED [HUGE Overnight Trade Opportunity During Election Week?!]( [WAR Election - Open House]( I closed biggest Overnight Trades during just ONE week: 214%... 190%... and as much as 293% gains... But the week of the election could bring the BIGGEST opportunities yet! For the first time ever... you can join our FREE Open House during Election Week (November 4 - 8). You can get ALL of our trade recommendations (including the Overnight Trades)... Plus... we'll have a Post Election Livestream Trading Event! [Go Here to Join Us for Free (No Cost... No Obligation... No BS!)]( [SAFETY NET]( [This Drug Giant's Dividend Isn't as Scary as It Looks]( [Marc Lichtenfeld, Chief Income Strategist, The Oxford Club]( [Marc Lichtenfeld]( Since Halloween is tomorrow, in this week's Safety Net, we're going to take a look at a dividend that many investors are afraid of. For as long as I can remember, Wall Street has been scared silly about AbbVie (NYSE: ABBV). The rub on AbbVie is that Humira, the company's top revenue generator and the biggest-selling drug in the world, is now off-patent. For many years, Wall Street analysts advised investors to stay away, warning that when Humira's patent expired, generics would flood the market and cause AbbVie's revenue, earnings, and stock price to crater as a result. But in reality, the company is as terrifying as a polite 4-year-old trick-or-treater in a princess costume. The chart below shows how wrong Wall Street analysts have been about AbbVie. [Chart: AbbVie (NYSE: ABBV)]( [View larger image]( Even now, more than a third of analysts that cover the stock don't rate it a "Buy." But I never let the "Wrong Way Corrigan" analysts influence me. AbbVie has been in the Compound Income Portfolio in my monthly newsletter, The Oxford Income Letter, since 2016. With dividends reinvested, we're sitting on a gain of 376% and enjoying an annual yield of 10.8% on our original investment. AbbVie is a Perpetual Dividend Raiser, having boosted its dividend every year since it was spun off from Abbott Laboratories (NYSE: ABT) in 2013. It currently pays shareholders a quarterly dividend of $1.55 per share, which gives the stock a 3.3% yield on the current price. Can AbbVie continue to be a Perpetual Dividend Raiser? SPONSORED [$1,300 into $45,000 in just 4 MONTHS?!]( [Big Returns]( Over the past few months, everyday Americans have been reporting BIG returns from a brand-new trading strategy... Including one top success story who reported that she grew her $1,300 to $45,000 in just 4 months. It's now easier than ever thanks to a brand-new AI. [See here to see the full details.]( In the second quarter, Humira sales dropped 29% year over year. As a result, the company's free cash flow is forecast to decline from $22.1 billion last year to $17.6 billion in 2024. However, AbbVie is only expected to pay $11.1 billion in dividends for a payout ratio of 63%, which is well within my comfort range. I like to see companies' payout ratios stay below 75% of their free cash flow. That tells me that even if free cash flow declines, the company should be able to afford its dividend going forward. Plus, as I said above, AbbVie has boosted its dividend every year for 11 years, showing investors its commitment to dividend growth. [Chart: A Not-So-Scary Dividend - AbbVie's annual dividend per share]( [View larger image]( Considering all of that - the decline in Humira sales, the payout ratio, the dividend track record, etc. - what grade would you give AbbVie's dividend? Click the button below to let me know your thoughts in the comments. Then scroll up to reveal my dividend safety rating. [Share Your Grade Here!]( [Marc's Recent Winners]( [The 27th Annual Investment U Conference 2025 - Ponte Vedra Inn & Club in Ponte Vedra Beach, Florida, March 30 - April 2, 2025.]( BUILD AND PROTECT YOUR WEALTH [Discover the Top Passive Income Opportunity for 2024...]( [Election Scenarios and Their Impact on Markets]( [Alex Green Wants to Give You This "Gift" (Valued at $4,000)! 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