Introduction
Abbott Laboratories is an American-based healthcare company, founded in 1888. It’s been in business for more than a century, manufacturing, marketing and selling medical devices, pharmaceuticals, nutrition products, and diagnostics. Over the years, Abbott Labs has consistently paid out regular dividends to its shareholders. In this article, we’ll take a look back at Abbott Labs’ dividend history and learn what it can tell us about the future of the company’s dividend payments.
History of Abbott Labs’ Dividend Payments
Abbott Labs has been paying dividends since 1941. Since then, the company has increased its dividend payments every year, with the exception of 2009, when the company froze its dividend payments due to the global financial crisis. Since then, however, Abbott Labs has resumed its regular dividend payments, with the most recent increase occurring in the 2019 financial year. The company has also been generous with its dividend payments, with a payout ratio of more than 40%. This is higher than the industry average, indicating that the company has been committed to providing its shareholders with a steady stream of income.
Dividend Yields
As of the end of the 2020 financial year, Abbott Labs had a dividend yield of 2.67%. This is slightly lower than the industry average of 3.00%. However, this is still a solid yield, especially when you consider the company’s long track record of increasing dividend payments. In addition, the company’s payout ratio of more than 40% means that it is likely to continue to increase its dividend payments in the future.
Dividend Growth
In the past five years, Abbott Labs has increased its dividend payments every year. The company’s dividend growth rate has averaged 8.5% over the past five years, which is significantly higher than the industry average of 6.1%. This indicates that the company is committed to providing its shareholders with a steady stream of income.
Dividend Safety
Abbott Labs has a strong balance sheet, with a debt-to-equity ratio of 0.87. This indicates that the company is in a good financial position and should be able to continue to meet its dividend payments in the future. In addition, the company has a low payout ratio of less than 40%. This indicates that the company is not overly reliant on its dividend payments for income and should be able to continue to increase its dividend payments in the future.
Conclusion
Abbott Labs has an impressive dividend history, with consistent dividend payments for more than 80 years. The company has also been generous with its dividend payments, with a payout ratio of more than 40%. In addition, the company has a strong balance sheet and a low payout ratio, indicating that it should be able to continue to meet its dividend payments in the future. For investors looking for a steady stream of income, Abbott Labs is an attractive option.