Lee Jackson
6 min read
Quick Read
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Splitting $175,000 evenly across AbbVie, Kinder Morgan, T. Rowe Price and Verizon generates about $7,468 in yearly dividends, a 4% blended yield.
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Verizon pays the richest yield at 6% and funds it with rising free cash flow, yet carries $166 billion in debt.
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Every payout carries a risk, from Kinder Morgan’s 2016 dividend cut to T. Rowe Price’s $28 billion in client outflows, so coverage needs quarterly monitoring.
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Building a portfolio and living off one are two completely different skills, and almost nobody teaches the second. This problem is what The Definitive Guide to Retirement Income helps, and it is free today. Read more here. (Sponsor)
Retirees spend decades building a nest egg, and then they have to turn it into a paycheck that comes whether markets rise or fall. Social Security covers part of the gap. Many families fill the rest by selling shares, which means selling at whatever price the market offers that month.
Dividend stocks offer another path. A $175,000 portfolio split evenly across four high-yield stocks from four different sectors would return more than $7,400 in annual income at current forward yields. A $43,750 stake in each one would produce the following. Dividends can be cut, and this income is not guaranteed, so each profile includes a dividend-safety check and one key risk.
AbbVie: A Dividend Aristocrat With a Fresh Raise
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Stock #4: AbbVie (NYSE:ABBV)
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Yield (forward): 2.47%
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Shares for $43,750: 148.22
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Annual Passive Income: ~$1,079.04
AbbVie sells immunology, neuroscience, oncology and aesthetics drugs. Skyrizi revenue grew 22.7% in Q3 and Rinvoq revenue grew 23.9%, which more than offset Humira’s fall. The stock has gained 32.98% year to date, so the yield is the lowest of the four even after the board raised the quarterly dividend from $1.73 to $1.82. The new rate is payable February 16, 2027.
The $7.28 annualized dividend equals about 52% of full-year adjusted EPS guidance of $13.95 to $13.99. Risk: Humira sales fell 31.2%, and acquisition charges drove Q3 GAAP EPS down to $2.37.
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