1 Dow Dividend I Don't Love Today

Before you go, we thought you'd like these...
Before you go close icon

The following video is part of our "Motley Fool Conversations" series, in which Austin Smith discusses topics across the investing world.

In today's edition, Austin takes a look at where the money comes from with monster pharma company Merck. This $120 billion titan is one of the largest companies in this space, but it's also mired in one of the most difficult parts of being a pharmaceutical company: patent cliffs. With 85% of Merck's revenue coming from its pharmaceutical division, which includes prescription meds, it's easy to see how the company can lose out in a big way when blockbuster drugs come off patent. That's exactly what's happening with Singulair in 2012, and it's repeated across this industry.

Despite these risks, Merck still pays a heady 4.3% dividend. A high yield is nice, but it wasn't enough for the company to earn a spot in our report: "Secure Your Future With 9 Rock-Solid Dividend Stocks." You can read more about these great high-yielding stocks today: Click here now.

At the time this article was published Austin Smith owns shares of Pfizer. The Motley Fool owns shares of Johnson & Johnson.Motley Fool newsletter services recommendJohnson & Johnson and Pfizer. Try any of our Foolish newsletter servicesfree for 30 days. We Fools may not all hold the same opinions, but we all believe thatconsidering a diverse range of insightsmakes us better investors. The Motley Fool has adisclosure policy.

Copyright © 1995 - 2012 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.

Read Full Story

Want more news like this?

Sign up for Finance Report by AOL and get everything from business news to personal finance tips delivered directly to your inbox daily!

Subscribe to our other newsletters

Emails may offer personalized content or ads. Learn more. You may unsubscribe any time.

From Our Partners