3 embarrassingly cheap dividend stocks
What is better than a stock that pays you to own it? How about a stock that pays you to own it and is also very cheap?
<p class = "canvas atom canvas text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = "Many investors, especially pensioners, love dividend stocks because they pay dividends on a regular basis Some dividend stocks can be quite expensive because investors like them so much, but not all Three dividend stocks appear to be embarrassingly cheap right now: AbbVie (NYSE: ABBV) [1[ads1]9659003] CVS Health (NYSE: CVS) and Gilead Sciences [19659002] (NASDAQ: GILD) . "Data-reactid =" 12 "> Many investors, especially pensioners, love dividend stocks because they pay dividends regularly. Some dividend stocks can be quite expensive because investors like them so much. But not all of them. Three dividend stocks appear to be embarrassingly cheap right now: AbbVie (NYSE: ABBV) CVS Health (NYSE: CVS) and Gilead Sciences ( NASDAQ: GILD) .
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1. AbbVie
AbbVie pays a dividend yield of nearly 6.6%. The big pharmacy stock is also dirt cheap right now, with shares trading below seven times expected earnings. Is it a catch with AbbVie? Of course.
<p class = "canvas atom canvas text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = "Investors are concerned about declining sales for Humira, with the substance already facing biosimilar competition in Europe and heading for the US market by 2023. Humira currently generates around 58% of AbbVie's total revenue. "data-reactid =" 27 "> Investors are concerned for falling sales for Humira, with the drug already facing biosimilar competition in Europe and heading for the US market by 2023. Humira currently generates around 58% of AbbVie's total revenue.
<p class = "canvas-atom canvas-text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = "However, AbbVies planned to acquire Allergan will significantly reduce the dependence on Humira, and even better the company has several topical drugs and pipeline candidates to help offset the declining sales for Humira. "Data-reactid =" 28 "> AbbVies planned acquisition of However, Allergan will significantly reduce the dependence on Humira. Even better, the company has several topical drugs and pipeline candidates to help offset the declining sales for Humira.
AbbVie's cancer drugs Imbruvica and Venclexta continue to enjoy great speed. Orilissa should be a success in the treatment of endometriosis and uterine fibroids. New immunologic drugs Skyrizi and upadacitinib are also likely to generate several billion dollars in additional sales over the next few years.
2. CVS Health
CVS Health's dividend currently yields 3.61%, a level that will capture any revenue-oriented investor eye. The health care giant can also be viewed as a bargain, with shares trading at just over eight times expected earnings.
<p class = "canvas atom canvas text Mb (1.0em) Mb (0) – sm Mt (0.8 em) – sm" type = "text" content = "There are a couple of reasons behind CVS Health's low valuation. Many were skeptical of the company's purchase of Aetna last year. With several presidential candidates advocating for changes that would adversely affect the health insurance industry doubts about wisdom in the Aetna agreement have intensified. "Data-reactid = "32"> There are a couple of reasons behind CVS Health's low valuation. Many were skeptical about the company's acquisition of Aetna last year. With several presidential candidates advocating for changes that would adversely affect the health insurance industry, the doubt about wisdom in the Aetna agreement has intensified.
<p class = "canvas-atom canvas text Mb (1.0em) Mb (0) – -sm Mt (0.8 em) – sm" type = "text" content = "In addition, some investors continue to be concerned about the potential threat that Amazon may pose to pharmacy retailers. The manager's acquisition of online pharmacy PillPack signaled that it is serious to try to disrupt the pharmacy market as it has other areas. " reactid = "33"> In addition, some investors continue to be concerned about the potential threat that Amazon may pose to pharmacy retailers. E-Commerce Manager's acquisition of online pharmacy PillPack signaled that it is serious to try to disrupt the pharmacy market as it has other areas.
<p class = "Canvas Atom Canvas Text Mb (1.0em) Mb (0) –sm Mt (0.8 em) – sm" type = "text" content = "So far, CVS Health has kept The company recently announced Q2 results that were much better than expected and raised the outlook for the full year 2019. "data-reactid =" 34 "> To date, CVS Health has merged. The company recently announced second quarter results that were much better than expected and lifted the outlook for the full year 2019.
3. Gilead Sciences
Gilead Sciences is something of a rarity: a biotechnology that pays dividends. The company's dividend yields 3.85%. The stock is also attractively valued, with shares trading at eight times expected earnings.
The history of Gilead over the last couple of years or so has centered on the declining sales of the drug franchise hepatitis C virus (HCV). Gilead's sales and earnings fell quarter after quarter, as biotechnology faced increasing competition in the HCV market and fewer patients were available because so many have been cured by hepatitis C, largely thanks to Gile's medication.
<p class = "canvas – atom canvas text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = "Now, however, Gilead seems to have turned a new page. returned to revenue growth in the first quarter of 2019 and continued the momentum in the second quarter . Gilead's flourishing has been driven primarily by the secret HIV drug Biktarvy. " reactid = "38"> Now, however, Gilead seems to have turned a new page. Biotechnology returned to revenue growth in the first quarter of 2019 and continued its momentum in the second quarter. Gilead's flourishing has been mainly driven by the secret drug Biktarvy.
The company could soon enter a new market. Gilead plans to submit filgotinib approval for rheumatoid arthritis treatment later this year. It also seeks to expand its dominance in HIV and increase its oncological presence.
Two Disadvantages of These Dividend Dividend Shares
AbbVie, CVS Health and Gilead offer high dividends and are reasonable compared to most stocks on the market. However, each share also has a few major drawbacks.
First, none of these stocks is likely to produce huge revenue growth in the near future. Wall Street analysts are projecting low double-digit earnings growth over the next five years for all three stocks.
<p class = "canvas-atom canvas text Mb (1.0 em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = "Secondly, each stock has AbbVie embarks on its biggest acquisition ever, and it does not have a good track record overall in terms of Dealmaking both AbbVie and Gilead face tough competition and the possibility that their pipeline candidates will not succeed. CVS Health is in the midst of integrating Aetna into a time of considerable uncertainty for pharmacy retailers and health insurance companies. "Data-reactid =" 47 "> Second, each share carries significant risk. AbbVie puts out its biggest acquisition ever, and it doesn't have a good track record overall when it comes to dealmaking. Both AbbVie and Gilead face stiff competition and the possibility that their pipeline candidates will not succeed. CVS Health is in the midst of integrating Aetna into a time of considerable uncertainty for pharmacy retailers and health insurance companies.
Dividends with high dividends and bargain stock prices cannot usually be achieved with weak income growth and low risk. Investors must be willing to accept these trade-offs before purchasing AbbVie, CVS Health or Gilead Sciences.
<p class = "Canvas Atom Canvas Text Mb (1.0em) Mb (0) – sm Mt (0.8 em) – sm" type = "text" content = " John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Keith Speights owns shares in AbbVie and Gilead Sciences, Motley Fool owns shares in and recommends Amazon and Gilead Sciences, Motley Fool recommends CVS Health. Fool has a disclosure policy . "data-reactid =" 50 "> John Mackey, CEO of Whole Foods Market, an Amazon affiliate, is a member of The Motley Fool's board. Keith Speights owns shares in AbbVie and Gilead Sciences. The Motley Fool owns shares in and recommends Amazon and Gilead Sciences. Motley Fool recommends CVS Health. Motley Fool has a disclosure policy.
<p class = "canvas atom canvas text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = "This article was originally published on Fool.com "data-reactid =" 51 "> This article was originally published on Fool.com
