2 Fantastic Dividend Stocks to Buy and Hold Forever

Dividend-paying stocks are great for the passive income they provide to those who choose to take their payouts in cash, and also for the opportunity to boost the long-term returns of those who choose to reinvest them. However, not all companies have the same philosophies about their payouts.

For some, returning capital to shareholders this way is something of an afterthought. They boost their dividends rarely, and they are more than willing to suspend their payouts when the going gets rough. Other companies make their dividend programs a top priority, increase their payouts regularly, and are unlikely to change any of that even during challenging times.

Companies in that second group are the ones that income investors should aim to keep in their portfolios for good. Two dividend stocks that fit this profile are Abbott Laboratories (NYSE: ABT) and Medtronic (NYSE: MDT).

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1. Abbott Laboratories

Abbott Laboratories, a medical device specialist, is one of the more impressive and reliable dividend stocks on the market, for several reasons.

First, its business is well-equipped to perform well through good and bad economic times. Thanks to the many patents it owns, it benefits from a degree of pricing power. Moreover, many of its products are a matter of life or death for the patients who need them, so they remain in high demand regardless of economic conditions. The result is a highly resilient business that can remain steady even in the worst recessions.

Second, Abbott is an innovator. The various devices it has pioneered or improved upon have helped improve outcomes for many patients. Among the more recent examples of this are its continuous glucose monitors (CGMs), devices that help people with diabetes track their blood sugar levels. Since they do so automatically many times throughout the day and send alerts to patients when their glucose is too low or too high, they help them make better health decisions.

Abbott Labs dominates the market for such systems, and its FreeStyle Libre CGM franchise is one of its best growth drivers. Indeed, it has become the top medical device in history in terms of dollar sales, a significant achievement that demonstrates the company's innovative capabilities.

Third, Abbott Laboratories has plenty of long-term tailwinds. Its CGM franchise is one of them, considering that the international market for those devices is severely underpenetrated. However, it has many others as well, thanks to its strengths across other therapeutic areas, including its cardiac health products.

Lastly, Abbott has a fantastic dividend track record. It's a Dividend King -- one of the small number of companies that boast at least 50 consecutive years of payout increases. Abbott's streak is currently at 53, and there are no signs that management plans to let that run end. All these factors make it an excellent buy-and-hold forever pick, especially for dividend-focused investors.

2. Medtronic

Medtronic shares many of the same characteristics as Abbott. It's a leader in medical devices with a vast and diversified portfolio of products across several therapeutic areas, which enables it to generate consistent revenue and profits. Medtronic's business is evolving, though, and the changes it is making are improving its prospects. Let's consider two of them.

First, the healthcare giant has decided to discontinue its diabetes care unit. The company struggled to compete with market leaders like Abbott in the CGM segment, and this was a drag on its bottom line due to its lower operating margins. So, this move should help boost the company's earnings. That is especially important considering Medtronic's global business and the potential impact tariffs could have on its financial results.

Second, Medtronic is close to earning regulatory clearance for its Hugo robotic-assisted surgery system, which will compete with Intuitive Surgical's (NASDAQ: ISRG) popular da Vinci systems. There is significant room for growth in this field, given the better outcomes that robotic-assisted surgery systems provide patients. The Hugo could prove to be an important long-term tailwind for Medtronic as it earns approval for use in a wider array of surgeries.

Meanwhile, Medtronic has demonstrated its financial resilience via 48 consecutive years of payout increases. It isn't a Dividend King yet, but it should be soon. In short, it's another top income-generating stock to consider for your portfolio.

Prosper Junior Bakiny has positions in Intuitive Surgical. The Motley Fool has positions in and recommends Abbott Laboratories and Intuitive Surgical. The Motley Fool recommends Medtronic and recommends the following options: long January 2026 $75 calls on Medtronic and short January 2026 $85 calls on Medtronic. The Motley Fool has a disclosure policy.