Healthcare Stocks With at Least 30 Years of Dividend Increases

Key Points

• Dividend investing can be a wise investment strategy because these stocks provide a dividend payment on top of the initial capital return.
• Stocks that increase their dividend every year make for better long-term investments,
• These health sector stocks have increased yearly dividends for at least 30 years.

While it is not the only factor to consider, the annual dividend can solidify whether a stock will benefit you financially. And among the many industry sectors to invest in, healthcare can be one of the most stable, especially regarding the dividend yield. Indeed, big dogs like Johnson & Johnson (NYSE: JNJ), AbbVie, Inc. (NYSE: ABBV), and Abbott Laboratories (NYSE: ABT) have been increasing their dividends for more than 50 years; and ABBV is considered one of the best dividend stocks out there.

The Marketbeat dividend calculator could help you determine if a stock is right for you. In addition, here are some strategies for picking the best dividend stocks [regardless of the industry]. Meanwhile, several lesser-known health sector stocks have paid increasing dividends for at least the last 30 years, dividend aristocrats and one qualifying as a dividend king. 

Becton Dickinson & Company: 51 years

Of all the companies on this list, Becton Dickinson & Co. (NYSE: BDX) may seem the most obscure, but they are obviously among the most prolific. BDX is paying a $3.64 annual dividend at a 3-year annualized growth rate of 4.33%. The dividend payout ratio is 68.68%, with a 1.58% dividend yield.

More importantly, while stock value is down around 10% on both the quarter, and the year, the medical device manufacturer projects earnings will grow 10.91% by this time next year. Of course, its current share price ($229.71) is higher than that of the big three mentioned above, but its Moderate Buy rating certainly makes it worth a look.

Medtronic PLC: 46 years

The world-class medical technology company Medtronic PLC (NYSE: MDT) has an annual dividend of $2.72 at a 3.55% yield. And while its 7.99% annualized 3-year growth rate is impressive, the 89.74% dividend payout ratio could turn some heads.

MDT's current share price is near the 52-week low, but its $90.72 price target does represent an 18.3% upside. That might make it an even more attractive price than the big dogs mentioned above. A 25.24 P/E is certainly strong, but earnings projections are mostly flat, so caution is advised if growth is your objective. Accordingly, MDT remains down 3.75% on the quarter and more than 26% since last year, which justifies its Hold rating.

Cardinal Health, Inc.: 37 years

Cardinal Health, Inc. (NYSE: CAH) has a sturdy record of acquisitions, the most recent of which was the $2.2 billion all-stock Bindley Western Industries. The company's steady growth has helped CAH pay a $1.98 annual dividend at a 2.82% yield. And while the 1.00% annualized 3-year growth rate is not as exciting, a 36.33% payout ratio makes up for it.

Analysts have given CAH a Hold rating, even though the current $71.19 share value is in the top 33% of the 52-week range. Earnings are projected to grow about 15%, and the $80.64 price target represents a 14% upside, but the stock has had a rocky year. The share price may be up more than 35% since last year but remains down about 10% in the last quarter.

Roper Technologies, Inc: 31 years

Medical and scientific imaging company Roper Technologies, Inc. (NYSE: ROP) is paying out an annual dividend of $2.73 at an impressive 3-year annualized growth of 10.20%. Sure, the 0.65% dividend yield may not be much to write home about, but the 6.41% dividend payout ratio still offers a consistent return.

ROP is down about 3% on all measures, so it may not be as impressive as other stocks on this list. Still, analysts give ROP a Moderate Buy rating. And while the $495.67 price target may represent an 18% upside, it is a pricey investment, especially with a less-impressive 9.09 P/E. With earnings projected to grow only about 5%, ROP might not be as lucrative as other stocks on this list, at least in the short term. 

West Pharmaceutical Services, Inc.: 30 Years

Specializing in the manufacturing, packaging, and delivery of injectable drugs, West Pharmaceutical Services, Inc. (NYSE: WST) saw a production boost during the Covid-19 pandemic. This may have maintained its annualized 3-year dividend growth rate of 14.06% and a 9.84% dividend payout ratio. However, its annual dividend is only $0.67 at a slight yield of 0.24%, so WST may not be as exciting as those mentioned above.

At $314.55, WST’s share price is at the dead center of the 52-week range but might be a little high for some. WST remains about 33% up on both the quarter and the year, so the stock is improving. Earnings are down, unfortunately, but they are also expected to improve–by more than 14%–next year. That said, the $291.25 price target represents a 7.4% downside. So while the dividend is strong, it makes sense that analysts have given the stock a HOLD rating.