By: Zane Okunor
Investment Channels: Dividend Paying Giants Still in the Lead
In a market often distracted by the next biotech breakthrough, the quiet strength of large healthcare companies is easy to overlook. Yet for investors who think in decades rather than months, dividend-paying giants like Medtronic, Johnson & Johnson, and Merck remain some of the most dependable names around. Right now, all three are trading below their recent highs, offering an entry point that long term investors especially those in their 20smay not want to miss.
Why Healthcare Holds Up
Healthcare isn’t driven by fleeting consumer tastes. People will always need surgeries, medications, and treatments regardless of what the economy is doing. That steady demand allows major players to invest for the long haul, keep their dividends growing, and weather the occasional market storm. While headlines about lawsuits, regulations, or patent expirations can temporarily weigh on prices, history shows these companies tend to come out stronger on the other side.
Medtronic: Reshaping for the Future
Medtronic is in the middle of a big strategic shift. Best known for devices used in heart care, surgery, and diabetes management, the company plans to spin off its diabetes division in early 2026. That unit is performing well up 10.4% in revenue recently but the move will let Medtronic focus more tightly on its highest margin areas. Meanwhile, its core businesses are healthy, delivering a 61.6% jump in net income last quarter. With a dividend yield near 3% its highest in yearsand 48 straight years of increases, Medtronic offers both income today and growth potential tomorrow.
Johnson & Johnson: Solid at the Core
Johnson & Johnson has one of the most impressive dividend records in the market over 60 years of uninterrupted growth. Its current yield of 2.91% is well above the healthcare average, yet the stock is still down about 5% from its peak. The reason? Ongoing talcum powder lawsuits, which have created an overhang despite no major new liabilities. Beneath the legal noise, J&J’s pharmaceutical and medical device divisions remain steady, and the company is investing heavily to replace drugs going off patent. When the legal clouds eventually lift, the market may take another look at its strong fundamentals.
Merck: Planning for Life After Keytruda
Merck’s challenge is straightforward: nearly half of its revenue comes from one drug, the cancer therapy Keytruda, which loses U.S. patent protection in 2028. That’s made investors nervous, pushing the stock down about 40% from 2024 highs. But Merck isn’t sitting still. It’s working on a new, easier-to-administer form of Keytruda, broadening its pipeline into cardiovascular and immune-related drugs, and making targeted acquisitions like Verona Pharma’s COPD treatment. Analysts think its current pipeline could generate up to $50 billion a year by the mid 2030s. Until then, the nearly 4% dividend offers a cushion for patient shareholders.
Looking Ahead
For younger investors, the combination of time, steady dividends, and sector resilience is hard to beat. Yes, risks exist legal disputes, patent expirations, and political pressure on drug prices but these are largely known and, in many cases, already reflected in current prices.
The opportunity here isn’t about catching a short lived rally. It’s about owning pieces of businesses that will still matter decades from now. Medtronic, Johnson & Johnson, and Merck may not make the loudest headlines, but they have the balance sheets, history, and staying power to quietly build wealth year after year. For anyone starting their investment journey, that’s a foundation worth considering.