2 Dividend Growth Stocks to Buy and Hold Forever
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For investors focused on the long game, there is little reason to sell -- at least, so long as a company generates solid returns through consistently imving financial results, regularly...
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July 6, 2025
07:05 AM
The Motley Fool
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For investors focused on the long game, there is little reason to sell -- at least, so long as a company generates solid returns through consistently imving financial results, regularly increases its dividend (if it pays one), and maintains strong growth spects
Although it's sometimes difficult to find corporations that can do all that over long periods, stocks of this caliber do exist
Consider the ing two healthcare leaders: Zoetis (ZTS 0. 06%) and Eli Lilly (LLY 0
They have checked all of those boxes over the past decade, and there are good reasons to believe they can continue to do so for a very long time, making them excellent "forever" stocks
Read on to learn more these companies
Image source: Getty Images
Zoetis Zoetis is a leading animal health company with a diverse portfolio of ducts spanning various, including stock, companion animals, and more
The company has 15 ducts that generate over $100 million in annual sales and consistently grows its revenue at a rate faster than most of its peers
Between 2014 and 2023, the company's top line increased at a compound annual growth rate of 8%, compared to the 5% the industry average
The company has encountered some headwinds recently
Most notably, recent drug apvals by competitors could challenge the market of one of Zoetis' most significant growth drivers, Apoquel, which helps treat allergic itch in dogs
Even so, Zoetis has dealt with competition for years and has still performed well
Although this issue may somewhat affect its results in the short term, the company's spects look attractive for several reasons
First, Zoetis will continue to launch newer ducts
It has ven itself to be an innovative leader in the animal health industry
Some of Zoetis' recent apvals, such as Solensia (first apved in 2022) and Librela (first apved in 2023) -- which treat osteoarthritis pain in cats and dogs, respectively -- are already helping drive sales growth
There will undoubtedly be plenty more such commercial launches in the future
In the long run, Zoetis will benefit from the growth in the pet population, which has been for several decades in countries the U. , as well as other trends such as increased demand for tein sources due to human population growth, resulting in a greater need for ducts that help care for stock
Zoetis can ride these tailwinds for a very long time
Finally, the company offers a solid dividend gram, despite a forward yield of just 1. 3%, which is equal to the average yield for the S&P 500 index
Still, Zoetis' payouts have increased by an impressive 502% over the past decade
Yet its payout ratio of 31. 6% remains conservative
There is ample space for more dividend hikes for Zoetis
Expect the company to offer consistent payouts and solid returns over the long run
Eli Lilly Eli Lilly has garnered significant attention in the past five years for its work in weight management, but the company has also quietly increased its dividends at a steady pace
The drugmaker's payouts have doubled over the past five years
That's not surprising
Eli Lilly's seems to be firing on all cylinders
Revenue and earnings have been growing rapidly
The company's first-quarter top line jumped 45% year over year to $12
Most similarly sized pharmaceutical leaders would be thrilled to increase their revenue by a third of that percentage
That speaks volumes Eli Lilly
And while its recent clinical and regulatory successes in the anti-obesity space are doing most of the heavy lifting, the company isn't a one-trick pony
Eli Lilly has blockbuster medicines in other areas, such as immunology -- with Taltz -- and oncology, thanks to Verzenio
Even the company's pipeline is diversified across multiple therapeutic areas
It has recent apvals, too
Such ducts as Kisunla, which treats Alzheimer's disease, could eventually generate more than $1 billion in annual sales
Here's the point: Eli Lilly is an incredibly innovative company with a leadership position in diabetes and obesity, as well as significant foots in other fields
The company is well positioned to develop new and imved ducts while generating above-average returns over the long term
That's why dividend investors shouldn't be turned off by the company's low 0. 8% forward yield
Eli Lilly's solid track record and modest cash payout ratio of 44% tell us plenty
That, combined with Eli Lilly's strong underlying, makes it an attractive buy-and-hold option
Sper Junior Bakiny has positions in Eli Lilly
The Motley Fool has positions in and recommends Zoetis
The Motley Fool has a disclosure policy.
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