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2 Top Dividend Stocks to Buy in December

AInvestSunday, Dec 8, 2024 4:30 am ET
4min read


As the year comes to a close, investors are looking for reliable income and long-term growth opportunities. Two top dividend stocks to consider in December are Microsoft Corporation (MSFT) and Johnson & Johnson (JNJ). Both companies have a strong track record of dividend growth and offer attractive yields, making them excellent choices for income-oriented investors.

Microsoft Corporation (MSFT) is a dominant player in software and cloud services, with a current yield of 1.1%. The company has increased its dividend for 17 consecutive years, reflecting its strong financial performance and earnings growth. MSFT's earnings per share (EPS) have grown at a compound annual growth rate (CAGR) of 12.1% over the past five years, driven by its Intelligent Cloud segment and productivity services. The company's robust cash flow generation, with free cash flow (FCF) of $61.3 billion in the last twelve months, supports its dividend payout.

Johnson & Johnson (JNJ) is a diversified healthcare company with a current yield of 2.4%. The company has increased its dividend for 59 consecutive years, demonstrating its commitment to returning value to shareholders. JNJ's EPS have grown at a CAGR of 6.1% over the past five years, driven by its pharmaceutical and consumer health segments. The company's operating cash flow (OCF) of $25.1 billion in the last twelve months ensures the sustainability of its dividend.

Both MSFT and JNJ have strong balance sheets, with MSFT having $78.4 billion in cash and JNJ with $20.3 billion. Their consistent earnings growth and dividend increases make them attractive investments for income-oriented investors.

In conclusion, Microsoft Corporation (MSFT) and Johnson & Johnson (JNJ) are two top dividend stocks to consider in December. Both companies have a strong track record of dividend growth, robust business models, and competitive advantages that enable them to sustain and grow dividends. Their attractive yields and long-term growth potential make them excellent choices for income-oriented investors.


Disclaimer: the above is a summary showing certain market information. AInvest is not responsible for any data errors, omissions or other information that may be displayed incorrectly as the data is derived from a third party source. Communications displaying market prices, data and other information available in this post are meant for informational purposes only and are not intended as an offer or solicitation for the purchase or sale of any security. Please do your own research when investing. All investments involve risk and the past performance of a security, or financial product does not guarantee future results or returns. Keep in mind that while diversification may help spread risk, it does not assure a profit, or protect against loss in a down market.