Fears of a recession have been mounting, especially since the Federal Reserve announced its third consecutive interest rate hike of 75 basis points. With the PCE inflation index showing that…
inflation was much stronger than expected in August, further aggressive rate hikes by the central bank are inevitable.
As investors increasingly worry about an uncertain economic outlook, they are liquidating their stocks, and the market seems stuck in a firm bear grip. Moreover, the market selloff is expected to continue in anticipation of businesses falling short of third-quarter earnings estimates.
Zachary Hill, head of portfolio management at Horizon Investments, said, “In the near term, we are likely to have continued market volatility with a downward bias as we head into earnings season.”
Since it seems unlikely that the market will return to stability anytime soon, investors aged 50 and above should opt for stocks that belong to companies operating profitably enough to pay consistent dividends despite uncertain market conditions. To that end, healthcare stock Bristol-Myers Squibb Company (BMY) and CVS Health Corporation (CVS) are solid choices.
Bristol-Myers Squibb Company (BMY)
BMY discovers, develops, manufactures, and markets biopharmaceutical products globally. It offers solutions for hematology, oncology, cardiovascular, immunology, fibrotic, neuroscience, and Covid-19 diseases.
On September 16, BMY received approval from European Commission for LAG-3-Blocking Antibody Combination, Opdualag (nivolumab and relatlimab), for the treatment of unresectable or metastatic melanoma with tumor cell PD-L1 Expression < 1%. This approval would enable the treatment of all adults and adolescents above 12 years of age in all European Union member states, as well as Iceland, Liechtenstein, and Norway.
On September 15, BMY announced adjuvant treatment with Opdivo (nivolumab) demonstrated a statistically significant and clinically meaningful improvement in recurrence-free survival (rfs) in patients with Stage IIB/C Melanoma in the CheckMate -76K Trial.
On September 14, BMY declared a quarterly dividend of $0.54 per share, which would be paid out on November 1. The company pays a $2.16 per share dividend annually, which translates to a 3.03% yield on the current price. The current dividend payout ratio is 27.33%. The company’s dividend payouts have grown at a CAGR of 6.4% over the past five years.
For the second quarter of fiscal 2022 ended June 30, BMY’s revenue increased 1.6% year-over-year to $11.89 billion. During the same period, net earnings attributable to BMS increased 34.7% year-over-year to $1.42 million, while its EPS increased 18.4% year-over-year to $1.93.
Analysts expect BMY’s revenue for the fiscal year 2023 (ending December 2023) to increase 3.4% year-over-year to $47.70 billion. The company’s EPS for the next year is expected to grow 6.7% from the previous year to $8.02. Moreover, BMY has an impressive earnings surprise history, as it has topped the consensus EPS estimates in each of the trailing four quarters.
BMY’s stock has gained…
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