Many retirees are investors for a good reason: They can't rely entirely on Social Security to fund their retirement. Investing wisely provides a means to retire comfortably.
Three Motley Fool contributors think they have found stocks to buy that retirees should absolutely love. All three offer juicy dividend yields. Here are their cases for AbbVie (NYSE: ABBV), Bristol Myers Squibb (NYSE: BMY), and Gilead Sciences (NASDAQ: GILD).
Everything retirees need in a stock from A to Vie
Keith Speights (AbbVie): Reliable income (the more the better) and reasonable growth prospects. Those are the main items on retirees' wish lists in picking stocks. AbbVie provides both.
The big drugmaker's forward dividend yield stands at nearly 3.3%. It was even higher earlier this year, but AbbVie's share price has jumped over 20%. That isn't a bad problem to have.
Few companies beat AbbVie when it comes to the reliability of their dividends. It is a Dividend King with 52 consecutive years of annual dividend increases (including when it was part of Abbott Labs). Over the last five years, the company has boosted its dividend payout by nearly 45%.
The strong year-to-date gains AbbVie has delivered give you a hint of the company's growth prospects. This performance might be surprising considering that the drugmaker's revenue and profits have declined due to the patent expiration for Humira, its blockbuster autoimmune disease therapy.
However, AbbVie did a great job planning for Humira's loss of exclusivity. The company has two worthy successors already on the market that together should eclipse Humira's peak sales within the next few years. AbbVie has also invested in research and development and made several strategic acquisitions that have improved its growth prospects.
This dividend stock makes for a good low-volatility investment
David Jagielski (Bristol Myers Squibb): If you're a retiree, one stock that you'll probably love is Bristol Myers Squibb. The healthcare company has a tremendous track record for growth and acquisitions over the years, not to mention paying a solid dividend.
Although the stock has been struggling this year, losing more than 7% of its value thus far, it's a fairly stable investment with a beta value of less than 0.5.
The company faces challenges due to losses in exclusivity in multiple top drugs this decade, including Eliquis and Opdivo. But it has been accumulating assets over the years to build up its portfolio of new growth products.
In its most recent quarter, which ended on June 30, revenue from the growth portfolio rose by 18% to $5.6 billion. And by 2026, Bristol Myers expects its new products to generate at least $10 billion in sales.