10 Best Dow Jones Dividend Stocks According to Wall Street Analysts

1. Merck & Co., Inc. (NYSE:MRK)

Upside Potential as of February 6: 32.18%

Merck & Co., Inc. (NYSE:MRK) is a New Jersey-based pharmaceutical company that offers innovative health solutions to its consumers. In the fourth quarter of 2024, the company posted revenue of $15.6 billion, marking a 7% increase from the same quarter the previous year. The company has solidified its position as a leader in specialty pharmaceuticals and oncology, particularly with its flagship cancer drug, Keytruda, which has revolutionized treatment methods and driven notable revenue growth. The company’s strong market presence generates significant cash flow, allowing it to provide returns to shareholders. In FY24, Keytruda’s sales grew 18% year-over-year, reaching $29.5 billion.

Merck & Co., Inc. (NYSE:MRK) has made significant strides in expanding its drug pipeline. Initially, it expected its new drug portfolio to generate an additional $35 billion in revenue by the start of 2024, but this estimate has now been revised to $50 billion. This growth is largely attributed to a substantial increase in its clinical trials, with 26 phase III trials currently in progress, compared to just nine in 2021. Several of these trials have the potential to develop into blockbuster drugs, especially in the HIV treatment sector. Moreover, the company has partnered with Gilead Sciences on a combination therapy that could revolutionize HIV care.

Merck & Co., Inc. (NYSE:MRK), one of the best dividend stocks on our list, has been rewarding shareholders with growing dividends for the past 14 consecutive years. Its quarterly dividend comes in at $0.81 per share and has a dividend yield of 3.67%, as of February 6.

Merck & Co., Inc. (NYSE:MRK) was included in 86 hedge fund portfolios at the end of Q3 2024, according to Insider Monkey’s database. The stakes owned by these funds are worth over $7.1 billion in total. With over 14.6 million shares, Fisher Asset Management was the company’s leading stakeholder in Q3.

Overall Merck & Co., Inc. (NYSE:MRK) ranks first on our list of the best dividend stocks according to analysts. While we acknowledge the potential for MRK as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than MRK but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.

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