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4 Must-Own Dividend Stocks in 2021: AbbVie, Vale, Progressive, and HP

Sock markets are expected to remain uncertain in the coming months due to the continued spread of COVID-19 and concerns that a new strain of the virus may exacerbate the pandemic. While vaccination efforts are expected to buoy an economic recovery next year, it could be wise now, we believe, for investors to add dividend stocks such as AbbVie (ABBV), Vale (VALE), Progressive Corporation (PGR), and HP (HPQ) to their portfolios for both a steady income stream and price appreciation.

President Trump has signed a new stimulus bill which is good news for the markets going into 2021. However, the coronavirus pandemic s still raging and it is unclear how quickly vaccination efforts will contain the spread. Moreover, a new and more infectious strain of COVID-19 has spread in many European countries, pushing their governments to implement fresh lockdown measures and adding more uncertainty to the pace of economic recovery.

Along with these concerns, political gridlock and the pace of economic recovery are expected to inject continued uncertainty in the financial markets over the coming quarters. So, it might be wise to pick stocks that have a strong history of paying dividends and upside potential based on strong fundamentals.

AbbVie, Inc. (ABBV), Vale SA (VALE), The Progressive Corporation (PGR), and HP, Inc. (HPQ) are three stocks that have been increasing their dividends. These companies have proven business models and they are innovating quickly to grab more market share.

AbbVie, Inc. (ABBV)

ABBV is involved in the development and marketing of therapies that address a range of health conditions. The company’s products help treat conditions such as Parkinson’s disease, psoriasis, rheumatoid arthritis, and more. ABBV’s stock has gained 16.8% so far this year.

The European Medical Agency recently recommended RINVOQ for approval. RINVOQ is an oral drug for the treatment of adult patients with active psoriatic arthritis and/or active ankylosing spondylitis. This drug has been developed by ABBV and could lead to significant gains for the company in the future.

ABBV has declared a dividend per share of $1.3 for this quarter. This is an increase of 10.2% from the earlier dividend amount. VZ’s dividend payout has grown at a CAGR of 20.9% over the past five years. The company has an annual dividend yield of 5.04%. The four-year average yield of the company is 4.33%.

ABBV is expected to see revenue growth of 50.4% for the quarter ended March 31, 2021 and 17.9% in 2021. The company’s EPS is estimated to grow 16.2% in 2021 and at a rate of 10.9% per annum over the next five years.

How does ABBV stack up for the POWR Ratings?

A for Trade Grade

A for Buy & Hold Grade

A for Peer Grade

A for Industry Rank

A for Overall POWR Rating

The stock is also ranked #4 of 240 stocks in the Medical – Pharmaceuticals industry.

Vale SA (VALE)

VALE is involved in the production and marketing of industrial metals such as iron ore, copper, manganese, cobalt, platinum, and more. The company has operations in Brazil and internationally. VALE’s stock has risen 26.7% year-to-date.

VALE recently received a license to begin construction of its Capanema Project, which is in Santa Bárbara, Ouro Preto, and Itabirito (MG) Brazil. VALE has also adopted a new and flexible working model for employees that will involve remote working, on-site working, and near-site working. This development could increase operational efficiencies for the company.

For the last quarter, VALE declared a dividend per share of $0.25. This is an increase of 47% from the earlier dividend amount. The company has a four-year average dividend yield of 2.83% versus the current dividend yield of 2.81%.

VALE’s revenue is estimated to increase 47.6% for the quarter ended March 31, 2021 and 11.4% in 2021. The company’s EPS is expected to rise 46.1% in 2021 and 1.3% per year over the next five years.

VALE’s strong fundamentals are reflected in its POWR Ratings. It has a “Strong Buy” rating with an “A” for Trade Grade, Buy & Hold Grade, and Industry Rank. It is ranked #3 of 33 stocks in the Industrial – Metals industry.

The Progressive Corporation (PGR)

PGR provides insurance services for personal and commercial vehicles. The company also provides home insurance. PGR’s stock price has increased 35.5% year-to-date.

PGR recently introduced usage-based insurance and fleet management programs for businesses called Snapshot ProView. The company is also entering the voluntary benefits market by expanding its offering of pet health insurance.

PGR has declared a dividend per share of $0.1 for this quarter, which is consistent with its dividend payout for the last two years. PGR’s dividend payout has grown at a CAGR of 46.9% over the past five years. The company has an annual dividend yield of 4.99%. The four-year average yield of the company is 2.59%.

PGR’s revenue is expected to grow 12% for the quarter ended March 31, 2021 and 11.5% in 2021. The company’s EPS growth is expected to be 40.8% in 2020 and 1.4% per annum over the next five years.

It is no surprise that PGR has a “Strong Buy” in our POWR Ratings systems with a grade of “A” in Trade Grade, Buy & Hold Grade, Peer Grade, and Industry Rank. In the 60-stock Insurance - Property & Casualty industry, PGR is ranked #3.

HP, Inc. (HPQ)

HPQ is involved in the development, production, and marketing of computers and related equipment. The company has operations in personal and commercial markets. HPQ’s stock has gained 18.1% year-to-date.

The company recently announced that its print services and solutions will support cloud-based environments. The company’s enhanced online portal will help remote workers easily acquire printers and supplies.

HPQ has declared a dividend per share of $1.9 for the last quarter. This is an increase of 9.9% from the earlier dividend amount. HPQ’s five-year dividend payout CAGR is 18.3%. The company has a dividend yield of 3.19%, and the four-year average yield of the company is 3.08%.

HPQ’s revenue growth is expected to be 2.5% for the quarter ended January 31, 2021 and 2% for 2021. The company’s EPS is expected to grow 15.8% in 2021 and 10.7% per annum over the next five years.

HPQ’s strong fundamentals are reflected in its POWR Ratings. It has a “Strong Buy” rating with an “A” for Trade Grade, Buy & Hold Grade, Peer Grade, and Industry Rank. It is ranked #7of 30 stocks in the Technology – Hardware industry.

Want More Great Investing Ideas?

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ABBV shares were trading at $104.95 per share on Tuesday morning, up $1.50 (+1.45%). Year-to-date, ABBV has gained 25.10%, versus a 17.78% rise in the benchmark S&P 500 index during the same period.



About the Author: Aaryaman Aashind

Aaryaman is an accomplished journalist that’s passionate about providing in-depth insights about investing and personal finance. Recently he has been focused on the stock market and he specializes in evaluating high-growth stocks.

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