It's been proved time and time again that buying for the long haul outperforms short-term investing. It's also been shown that investing in dividend-paying stocks can produce higher returns than investing in non-dividend-paying stocks. However, not all dividend-paying stocks are created equal. For instance, here are two dividend stocks that I think are worth avoiding and one that I think can be owned for the long haul.
Patent expiration will remain the biggest risk to dividend-paying stocks in healthcare, and that's particularly true for PDL Biopharma's (NASDAQ: PDLI) and Amgen's (NASDAQ: AMGN). Both of those companies are taking steps to ensure that sales growth doesn't sputter and put dividend payouts in jeopardy. But neither offers the kind of clarity that most dividend investors require to make them part of an income portfolio. That suggests that a better bet is to own Gilead Sciences (NASDAQ: GILD). Gilead Sciences' top sellers have plenty of patent protection, and it has a rock-solid balance sheet that could mean its dividend is both safe and likely to grow.
Source: Motley Fool
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