Why I Think These Are the 2 Smartest Stocks to Buy With $5,000 in October
2026-10-05 19:15
•Leo Sun •The Motley Fool
••••••••• •• Axe Cap view
Two Resilient Dividend Stocks Worth Watching in Tough Times
AbbVie and Medtronic offer reliable income and growth, even when global rate hikes batter markets.
With the Fed hiking rates and Treasury yields on the rise, many investors shy away from stocks. But certain dividend stalwarts continue to shine. AbbVie, with over 50 years of consecutive dividend increases, brings rare stability. Its growing pipeline, particularly drugs like Skyrizi and Rinvoq, plus smart acquisitions, help cushion the blow from Humira’s patent expiry. Trading at a reasonable forward multiple around 16, it’s a solid bet for steady income and growth. Medtronic isn’t quite a Dividend King yet but is almost there after 49 years of hikes. It is benefiting from smart restructuring and delivering strong organic growth in medical devices. The stock trades at an attractive 18 times earnings after a washout, making its near 3.3% yield a compelling entry point. For South African investors, these stocks help diversify away from local market volatility and currency swings, given USD exposure and robust sectors. However, global recessions or renewed regulatory risks in pharma and medtech could dampen returns. this is just our opinion and not financial advice
Buy AbbVie for reliable dividend growth and a fair valuation, and add Medtronic as a slightly deeper-value play with solid operational momentum. Hold positions rather than chase yieldier but riskier stocks.
- ABBV
- MDT
- USD/ZAR
- Global economic slowdown hitting pharma and medtech demand
- Regulatory challenges affecting drug approvals and medical device sales
6/10
Despite recent Fed rate hikes and rising Treasury yields, the article recommends two blue chip dividend stocks: AbbVie, a Dividend King with 53 consecutive years of dividend increases and strong growth prospects from new drugs, and Medtronic, which is on track to become a Dividend King with 49 consecutive years of dividend hikes and improving operational performance after recent restructuring.
Our take is based on reporting first published by The Motley Fool.