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Healthcare stocks could make an attractive addition to your portfolio in May 2024, thanks to their resilience in recessions and high inflation.
Leading Wall Street analysts believe that the stubborn inflation and increasing market volatility are warning signs of an impending market downturn. Passive investors should, therefore, consider including healthcare stocks in their portfolio as a hedge against the recession.
Top dividend healthcare stocks offer a consistent cash flow even when the stock market is bearish. Below are the top dividend-paying healthcare stocks in the third-largest sector in the S&P 500.
Johnson & Johnson (NYSE:JNJ)
The world’s largest healthcare company by revenue is the top pick for the best dividend stocks for passive investing.
Analysts are bullish on JNJ thanks to its healthy balance sheet despite rapidly rising debt. The stock has a 63-year dividend payment history, with yields increasing gradually over the years.
JNJ is currently offering a quarterly dividend yield of 3.31%, which is higher than the industry average of 2.28%. The ex-dividend date is May, 20 2024.
The last three analyst ratings were released from RBC Capital, Cantor Fitzgerald and HSBC on May 16, 2024, May 6, 2024 and April 18, 2024, respectively. With an average price target of $186.67 between these three analysts, there’s an implied 21.08% upside for Johnson & Johnson.
Pfizer Inc. (NYSE:PFE)
This pharmaceutical behemoth has traded on its 52-week low for the last six months. Nonetheless, analysts remain bullish as its balance sheet strengthens thanks to its cost-cutting measures.
The drug maker launched a $3.5 billion cost-cutting program in 2023 in response to declining COVID-19 vaccine sales.
Pfizer is a stable company with a flawless dividend payment history. The stock is offering a dividend yield of 5.96% in May 2024, which is higher than the industry average of 2.28%.
Pfizer’s dividend payment demonstrates its commitment to giving its investors a consistent cash flow even in recessions. The stock has a strong 37-year dividend payment history.
The last three analyst ratings were released from Morgan Stanley, BMO Capital and Cantor Fitzgerald on May 2, 2024, May 2, 2024 and April 18, 2024, respectively. With an average price target of $36.67 between these three analysts, there’s an implied 28.50% upside for Pfizer Inc.
Hesitant To Put More Money In The Market Right Now?
The economy is very uncertain right now, and many investors are just waiting for the other shoe to drop. Warren Buffett has recently increased Berkshire Hathaway’s cash position in what appears to be preparation for a bear market. And several other economists, fund managers and market experts have been calling for a massive slide in the stock market.
On the other hand, idle cash is certain to lose value as inflation remains high. One approach is to consider a short-term cash management tool that provides a high yield and principal protection. This will allow you to keep earning income from your cash while waiting for better market opportunities.
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This article These Healthcare Stocks Could Make A Great Addition To Any Passive Income Portfolio originally appeared on Benzinga.com
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