For investors seeking stable, long-term returns, the ultimate goal is to find those “heirloom” assets that can be bought and held with confidence for decades. Such treasures are especially valuable in volatile markets.
Currently, two healthcare giants—pharmaceutical leader Bristol Myers Squibb (BMY) and medical device titan Medtronic (MDT)—are viewed by some analysts as compelling candidates for this “buy-and-hold-forever” logic, thanks to their solid business foundations and sustainable dividend policies.
Investors searching for high yield in the pharmaceuticals sector often face a dilemma: extremely high dividend yields (like Pfizer’s 6.8%) can come with unsustainably high payout ratios, while very safe dividends (like Eli Lilly’s, with a payout ratio around 30%) often offer meager yields (0.6%).
Bristol Myers Squibb charts a pragmatic “middle course”: it offers a current yield of approximately 4.6% with a payout ratio around 85%. This provides an attractive immediate cash flow while maintaining a buffer to help secure the dividend.
Of course, long-term holders must acknowledge the coming “patent cliff.” Blockbuster cancer drugs Revlimid and Pomalyst will face generic competition in 2026, and the key cardiovascular drug Eliquis will lose patent protection in 2028. This is a routine challenge for major pharma companies. In response, BMY has been consistently investing in and acquiring to replenish its drug pipeline. The market recognizes the company’s long-term viability, and its historical commitment to dividends bolsters investor confidence. For the long-term investor seeking a balance between attractive yield and sustainability, it remains a classic choice.
Medtronic’s story is one of “recovery” and “perseverance.” As a leader in medical devices, its growth slowed a few years ago, partly due to the complexities of its large scale. Management is now working to reignite growth by exiting non-core businesses, cutting costs, and focusing on innovation (like its Hugo surgical robot system). The upcoming spinoff of its diabetes division is a key strategic step in this focus.
For dividend investors, the most compelling feature is its 48-year streak of consecutive annual dividend increases—just two years shy of the prestigious “Dividend King” status. With a current yield around 2.9% and a payout ratio near 75%, this remarkable record appears highly likely to continue. As the corporate overhaul gains traction and business growth potentially reaccelerates, future dividend growth should also find more support. For the “buy-and-forget” type of investor, an industrial giant that is streamlining its operations while boasting a nearly half-century dividend growth history is undoubtedly a story worth watching.
While higher-yielding options always exist in the market, the core of true long-term investing lies in sustainability. Chasing yield too aggressively can lead to dividend cuts. Both Bristol Myers Squibb and Medtronic, despite their respective cyclical challenges, demonstrate potential as long-term portfolio anchors through their fundamental business strength, strategic responses, and dividend track records.
For holders willing to measure their investment horizon in years or even decades, these companies offer a balanced consideration of yield, safety, and growth potential—the hallmarks of a foundational holding.
