3 Dividend Stocks to Buy and Hold Forever

The healthcare sector has faced challenges in recent years due to regulatory pressures and a somewhat uncertain outlook. However, thanks in part to its defensive nature and the fact that excellent medical care will always be in high demand, it remains an excellent place to find high-quality dividend stocks to stick with for a while. With that as a backdrop, let's consider a trio of healthcare dividend stocks that look built to last: CVS Health (NYSE: CVS), AbbVie (NYSE: ABBV), and Pfizer (NYSE: PFE). Read on to find out why these could be excellent buy-and-hold options for dividend seekers.

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1. CVS Health

After several years of struggles, CVS Health has bounced back. The company's shares have outpaced broader equities over the past 12 months, driven by stronger financial results and an improved medium-term outlook. CVS is working hard to address the challenges that plagued its business, including lower margins within its Medicare Advantage (MA) segment. The pharmacy chain giant has decided to scale back this business while looking to boost profitable growth.

While this initiative could have a major impact on CVS Health over the next five years, the company's long-term outlook is also strong. CVS Health's vast healthcare footprint comprises thousands of pharmacies and one of the largest health insurance businesses in the U.S. It has also made strides within the primary care niche.

CVS arguably has a competitive advantage, thanks to its being deeply entrenched in communities and having a trusted name and brand, an incredibly important thing in any sector, especially healthcare. Further, the company is evolving with the times. It now offers free, fast shipping options for prescription drugs. CVS's well-established, diversified healthcare business could enable it to capitalize on long-term tailwinds, such as the world's aging population, that will drive increased demand for its products.

Lastly, it is an attractive dividend stock with a forward yield of 3% versus the average of about 1% for the S&P 500; it has increased its payouts by 56.5% over the past decade. CVS is an attractive stock to buy for long-term income seekers.

2. AbbVie

AbbVie has struggled this year. Despite solid financial results, the market is concerned about some of the company's products that aren't performing well, especially as sales of its former best-selling medicine, Humira, continue to decline amid biosimilar competition. However, AbbVie's two most important growth drivers, Skyrizi and Rinvoq, which treat a range of autoimmune conditions, continue to outpace expectations. AbbVie does not expect any significant losses of patent exclusivity for the rest of the decade, so, thanks to its two growth pillars, revenue and earnings should move in the right direction over the medium term.

But what about after that? AbbVie has a deep pipeline across many therapeutic areas. It should eventually succeed in launching newer drugs to replace its current growth drivers, just as it did when it filled Humira's shoes after the medicine's patent cliff. AbbVie also has a franchise in its portfolio -- Botox -- that benefits from a competitive edge thanks to its brand name. Those factors (and others) should allow AbbVie to perform well over the long run. Finally, the company is an outstanding income stock. Along with its forward yield of 3.2%, AbbVie is a Dividend King: That's a company with 50 or more straight payout increases. This dividend is about as reliable as they come.

3. Pfizer

Pfizer remains down by more than 50% from the all-time highs it reached several years ago. The company's financial results have worsened as its coronavirus business stopped generating significant sales. However, the drugmaker now has a vast pipeline that should allow it to make significant clinical progress over the next few years and rejuvenate its lineup. Pfizer has already started doing so. Some of its newer products, such as Abrysvo, a vaccine for the respiratory syncytial virus, are performing well.

But some medicines in development, especially in oncology and chronic weight management, could be even stronger growth drivers down the line. The company may be struggling now, but it'd be wise for investors to buy its shares before clinical wins send the stock price up significantly -- and hold onto them for the long term -- given its strong foothold in the pharmaceutical industry. Pfizer currently offers a juicy forward yield of 6.6%, and it has increased its payouts by 51.3% over the past decade. It's a great income stock to hold onto for a while, especially for investors who purchase its shares at current levels.

Prosper Junior Bakiny has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends AbbVie and Pfizer. The Motley Fool recommends CVS Health. The Motley Fool has a disclosure policy.