AbbVie Offers Nice Dividend Yield, Stock At New High


DrugmakerAbbVie ( ABBV ) offers a nice dividend yield as the stock marches higher.

AbbVie, which was spun off fromAbbott Laboratories ( ABT ) earlier this year, is at its highest level since going public Jan. 2. It's climbed 17% since its IPO.

Meanwhile, the company on Feb. 15 declared a quarterly cash dividend of 40 cents a share, or $1.60 a year. That brings the annual dividend yield to 3.9% at the current share price. The dividend is payable May 15 to shareholders of record on April 15.

AbbVie was named to the S&P 500 Dividend Aristocrats Index of companies that have boosted their dividend for at least 25 straight years after the index changed its treatment of spin-off companies.

Bank of America on March 11 reaffirmed its buy rating on AbbVie shares and raised its price target by $2 to $42, which is 2% above Monday's close of 41.12.

AbbVie, formerly the pharmaceuticals unit of Abbott Labs, relies heavily on Humira, a treatment for rheumatoid arthritis, psoriasis and Crohn's disease that accounts for almost half of the company's revenue. Sales of testosterone-boosting treatment AndroGel have also picked up. AbbVie is currently working on a hepatitis C regimen that analysts expect will debut in 2015.

The company expects to earn between $3.03 and $3.13 a share in 2013, which is in line with Wall Street's expectations.

AbbVie's A- Accumulation/Distribution Rating points to strong institutional demand for the shares.

AbbVie is in the 40-member Medical-Ethical Drugs industry group, which hosts a number of current and former market leaders, including IBD 50 stock Valeant Pharmaceuticals ( VRX ) andQuestcor Pharmaceuticals ( QCOR ).

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.

This article appears in: Personal Finance , Investing Ideas

Referenced Stocks: ABBV , ABT , QCOR , VRX

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