Personal Finance

4 Stocks We're Never Selling

AGN Chart
AGN Chart

AGN data by YCharts .

Even so, I have no plans to sell this top pharma stock. In fact, I am using this extended period of weakness to add more shares because this stock looks to be grossly undervalued.

Turning to the specifics, Allergan's branded pharma portfolio sports several drugs with double-digit growth rates at the moment. In the third quarter, for example, sales of eye drop medication Restasis rose by 14% to $356.4 million, and the drugmaker's flagship cosmetic product, Botox, also saw its sales rise by 10% to $174.5 million, compared to the same period a year ago. The best part is that these kinds of stellar growth rates are fairly standard for Allergan's branded pharma business across the board.

Beyond its high-growth branded drug business, Allergan is also deeply committed to its shareholder rewards program. According to its Q3 earnings release, for instance, the drugmaker plans to plow an additional $10 billion into its accelerated share repurchase program, and initiate a quarterly dividend of $0.70 per share starting in the first quarter of 2017.

So, in light of Allergan's outstanding branded drug business and rich shareholder rewards, I'm more than happy to sit tight and simply let the moody market run its course.

Hardly worth throwing away

Tyler Crowe : I'm awfully hard-pressed to find a reason that would make me want to sell my shares of Waste Management. When it comes to competitive advantages, Waste Management has them in spades. The industry is highly regulated, capital-intensive, geographically specific (I mean, what are the chances of multiple landfills in a single town?), and serves a basic need that won't likely be disrupted by technology anytime soon.

Waste Management takes all of those advantages and puts them in a tightly run ship that generates fantastic returns on capital for what is a relatively low-margin, low-growth industry. It also helps that management uses the cash generated from its high-return business to buy back stock and reward investors with a steadily growing dividend that yields a respectable 2.5%.

WM Return on Capital Employed (TTM) data by YCharts .

Perhaps if Wall Street were to lose its mind and push Waste Management's valuation into the stratosphere, I might consider selling this stock. Based on where it trades today, though, I'm more than happy to sit on this position while dividend checks come in and management increases my slice of the pie by retiring shares.

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George Budwell owns shares of Allergan and Pfizer. Jason Hall owns shares of MasterCard and Waste Management. Steve Symington owns shares of iRobot. Tyler Crowe owns shares of iRobot and Waste Management. The Motley Fool owns shares of and recommends iRobot and MasterCard. The Motley Fool owns shares of Waste Management. Try any of our Foolish newsletter services free for 30 days .

We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy .

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


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

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