CVS Health Corp Announces Cash Payment to Investors
For investors interested in earning recession-proof dividends, CVS Health Corp (NYSE:CVS) stock deserves a look.
On Wednesday, March 14, CVS Health Corp announced that its board of directors declared a quarterly cash dividend of $0.50 per share. The dividend will be paid on May 3, 2018 to shareholders of record as of April 23. (Source: “CVS Health Corporation Announces Quarterly Dividend,” CVS Health Corp, March 14, 2018.)
Trading at $67.11 apiece, CVS stock offers an annual dividend yield of three percent.
The yield itself may not look that exciting, but note that CVS Health has been increasing its payout. The company has raised its quarterly dividend rate in each of the last 14 years. (Source: “Dividend History,” CVS Health Corp, last accessed March 14, 2018.)
In other words, even during the Great Recession—considered by many to be the biggest downturn since the Great Depression—CVS Health Corp still managed to increase its dividend every single year.
The company’s growing dividends are backed by solid financials. In 2017, CVS Health grew its revenue by 4.1% year-over-year to $184.8 billion. Excluding a $1.5-billion income tax benefit resulting from the tax reform, adjusted earnings came in at $5.90 per share for 2017, representing a one-percent increase from 2016. (Source: “CVS Health Reports Fourth Quarter Results and Updates 2018 Full-Year Outlook for Investments from Tax Reform,” CVS Health Corp, February 8, 2018.)
Ultimately, keep in mind that healthcare is known as a recession-proof industry. With more than 9,800 pharmacies and a huge pharmacy benefits manager business with over 94 million plan members, CVS Health is well-positioned to keep generating oversized revenues and profits. And that should translate to a steadily increasing stream of dividends for CVS stock investors.