On Dividends -- April 16, 2021

Disclaimer: this is not an investment site.  Do not make any investment, financial, job, career, travel, or relationship decisions based on what you read here or think you may have read here. 

I'm running out of time this morning so I will come back to these two stories later. 

First, dividend stocks are out of favor, but here are nineteen that Wall Street loves, including CVX and WMB. Link to MarketWatch.

Williams Cos. Inc. and Chevron Corp. provide some insight into what has gone on in energy during the COVID-19 pandemic. 

Williams is an oil refiner and pipeline operator, while Chevron is an integrated oil company. It was not surprising to see both drop as fuel demand cratered during the pandemic’s most painful period for financial markets. 

But 20/20 hindsight makes the stocks’ declines appear to be overreactions. Williams came roaring back, producing a return of only -8% in 2020. The stock is up 20% so far in 2021. 

Chevron was down 26% in 2020 and has returned 24% so far in 2021. Analysts see plenty of price upside for both companies — and that excludes the dividends. 

Second, a reminder: a dividend aristocrat on sale -- AbbVie. Think Humira.

Heart drug Lipitor is the biggest-selling drug of all time. Perhaps no surprise to dedicated pharma-watchers, who know the statin med still racks up blockbuster-level sales despite years of generic competition.

It won't hold that crown for much longer, though. AbbVie's Humira is set to steal it away—and remain history's biggest-selling drug at least through 2024. Lifetime total by then? A whopping $240 billion. [AbbVie's Humira goes off-patent in 2023, and every Tom, Dick, and Harry will start to manufacture it.]

That fact may not be all that surprising, either. But as generics continue to bite and biosimilars begin to rear their heads, the current set of all-stars is in for a shuffle over the next five years, according to estimates tallied by Evaluate Pharma.In both cases, the articles bring up points that have nothing to do with investing or dividends. They are simply interesting stories for other reason.

I will have to go back and look, I've long forgotten but I put Lipitor in "old" biotechnology; Humira in "new" biotechnology. 

The Covid-19 vaccine research will morph into "Star Trek" biotechnology. It was research into an Ebola virus vaccine that led to the success of the Covid-19 vaccine. Interestingly enough, an Ebola virus vaccine was never marketed; that research was done under pre-Trumpian thinking.

[Ronald Reagan brought us a "Star Wars" military-industrial complex. Donald Trump brought us "Star Trek" biotechnology.]

We are now back to pre-Trumpian thinking with the new administration but there is one difference. The "horse has left the barn" as they say. 

By the way, that was the same thing that happened with regard to fracking, which we discussed years ago. Wow, the synapses are firing today. Chaos.