Finding Consistent Dividends: OMHA as a Warren Buffet Variant for Total Returns

OMAH is a variant of the Warren Buffet strategy that aims to provide investors with solid total returns and consistent dividends. The strategy involves finding companies with a history of paying consistent dividends, which are then held for the long term to benefit from potential growth. OMAH seeks to balance the trade-off between dividend yield and capital appreciation, making it an attractive option for investors seeking stable returns.

The OMAH strategy, a variant of the Warren Buffet strategy, aims to provide investors with solid total returns and consistent dividends. This approach involves finding companies with a history of paying consistent dividends, which are then held for the long term to benefit from potential growth. The strategy seeks to balance the trade-off between dividend yield and capital appreciation, making it an attractive option for investors seeking stable returns.

Two notable healthcare companies that align with the OMAH strategy are Zoetis (NYSE: ZTS) and Eli Lilly (NYSE: LLY). Both companies have demonstrated strong financial performance, consistent dividend growth, and promising long-term prospects.

Zoetis is a leading animal health company with a diverse portfolio of products spanning various categories, including livestock, companion animals, and more. The company has 15 products that generate over $100 million in annual sales and consistently grows its revenue at a rate faster than most of its peers. Between 2014 and 2023, the company's top line increased at a compound annual growth rate of 8%, compared to the 5% industry average [1]. Although Zoetis has faced recent challenges with drug approvals by competitors, the company's innovative product pipeline and long-term growth prospects remain attractive. Zoetis offers a solid dividend program, with payouts increasing by an impressive 502% over the past decade, despite a forward yield of just 1.3% [1].

Eli Lilly, on the other hand, has garnered significant attention for its work in weight management but has also quietly increased its dividends at a steady pace. The drugmaker's payouts have doubled over the past five years, reflecting the company's strong business performance. Eli Lilly's revenue and earnings have been growing rapidly, with the first-quarter top line jumping 45% year over year to $12.7 billion. The company's diversified product pipeline and strong underlying business position it as an attractive buy-and-hold option, despite a low 0.8% forward yield [1].

Another healthcare giant that aligns with the OMAH strategy is AbbVie (NYSE: ABBV). AbbVie is a pharmaceutical leader with a large portfolio of approved products, including immunology medicines Skyrizi and Rinvoq. The company has increased its payouts by 310% since 2013, making it a Dividend King with 53 consecutive years of payout increases [2]. AbbVie's strong business performance and deep pipeline position it as a solid long-term investment.

Abbott Laboratories (NYSE: ABT) is another Dividend King that aligns with the OMAH strategy. The company's diversified operations in medical devices, diagnostics, pharmaceuticals, and nutrition help it overcome challenges in specific segments. Abbott Laboratories has been a leader in the highly regulated healthcare sector for decades, with a solid reputation with physicians and consumers. The company's diabetes care segment, led by the FreeStyle Libre, is a significant growth driver, with massive whitespace ahead [2].

In conclusion, the OMAH strategy focuses on finding companies with a history of consistent dividends and long-term growth prospects. Zoetis, Eli Lilly, AbbVie, and Abbott Laboratories are notable healthcare companies that align with this strategy, offering investors solid total returns and consistent dividends.

References:
[1] https://finance.yahoo.com/news/2-dividend-growth-stocks-buy-110500933.html
[2] https://finance.yahoo.com/news/2-dividend-stocks-buy-decades-124500915.html