...in the healthcare industry, drug manufacturers tend to get noticed more. These companies are frequently very good investments, combining price growth with attractive dividends.Below, I will explore Abbott Laboratories , Allergan Inc , Amgen Inc , Johnson & Johnson and Novartis AG to see if they present a good entry point for investors looking at this sector. I based my analysis on these five companies because they are all innovative market leaders with a history of strong growth.
Located in Abbott Park, IL, Abbott Labs is a manufacturer of a wide variety of prescription and over-the-counter drugs; it is also a creator of profit for investors. The company has been paying dividends without fail since 1924. While this is good news, investors today can expect even more, thanks to projected share price increases. Paying a dividend of $1.92 for an impressive 3.5% yield, Abbott's stock is expected to climb from its current $55 per share to $59.50, for an increase of over 8%. Combined with a potentially record dividend, this is one company that should have investors excited. (...)
Allergan is another company that has been on a hot streak. The $27 billion company offers both prescription and over-the-counter pharmaceuticals, in addition to medical devices and cosmetic drugs like Botox. Currently trading near $87.50 per share with a price to earnings of 30 and a dividend of dividend of $0.20 (for a yield of 0.2%), the company's success seems to have some dark clouds looming in the coming months. (...)
Amgen is a California-based company that researches, develops, makes and markets human therapeutics, both by itself and through joint ventures with companies like Pfizer Inc, GlaxoSmithKline plc, Takeda Pharmaceutical Company Limited and more. Currently trading for around $67.50 per share, it is expected to challenge the upper limit of its 52-week range of $47.66 - $70.00 (one-year target of $71.50), while paying a dividend of $1.44 for a yield of 2.1%. As 2011 drew to a close, the company pointed out successes with its Neulasta, Embrel and Xgeva drug lines, expressing optimism that Amgen would grow again in 2012. (...)
Johnson & Johnson represents one of the largest healthcare products companies in the world, thanks to its $177 billion market and its strong presence in the areas of pharmaceuticals, medical devices and consumer products. Thanks to the unexpected success of its rheumatoid arthritis medicine, Remicade, the company exceeded expectations in 2011. My concern going forward is that while it did well last year, its success only resulted in a 6.4% rise in share price and a 3.9% quarterly revenue growth, while the company's earnings tumbled 89%. Johnson & Johnson pays an annual dividend of $2.28 for a yield of 3.5%. (...)
Novartis is another of the group that I see traveling a similar path with Allergan and Johnson & Johnson. All three are good companies, but the current market pressures have held back their stock price gains while pushing down their profits. Although the Swiss company enjoyed a billion dollar success with Enoxaparin, competition has been eating away at the exclusive position the drug had previously enjoyed. Novartis is currently trading at $56.50, below the midpoint of its 52-week range of $51.60 - $64.82. The stock has a one-year target of $61.39; its price to book ratio of 2 and its price to earnings ratio of just over 14 suggest that the stock is reasonably priced. (...)
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