Buying Pfizer Inc. (PFE)’s History

Pfizer will need to convert those candidates into sales giants, but at least one fresh new drug has a bright future. Blood thinner Eliquis was approved late last year and looks as if it’ll be one of the bright stars of Pfizer’s future. Analysts have pegged Eliquis’ peak sales at around $3 billion, although the drug will have to compete against tough competition, such as Johnson & Johnson (NYSE:JNJ)‘s Xarelto — a drug that grew sales sharply in 2012 by pulling in more than $400 million last year and is already approved for several indications in the U.S.

Unfortunately for dividend investors, two of Pfizer Inc. (NYSE:PFE)’s best sellers today have just a few years left to enjoy patent exclusivity. Anti-inflammatory drug Celebrex, which sold more than $650 million last quarter, will face its patent expiration in 2015, while Lyrica — Pfizer’s top-selling drug last quarter — has until 2018 before it loses its patent protection. These looming losses shouldn’t scare income investors away, but it’s worth watching Pfizer’s up-and-coming developmental drugs closer to see how the company will replace these blockbusters later this decade.

Even with the patent cliff taking a chunk out of Pfizer’s sales, this is still a strong and steady stock for the long term — and one that income investors should love. Pfizer’s history of dividend increases and low payout ratio bode well for future raises, and while its current 3.3% dividend yield isn’t the strongest dividend in big pharma, it matches up favorably with many other blue chip stocks. Pfizer’s one of the best health care stocks regardless of your investment style, but for income investors looking into the medical sector, it’s hard to top this pharmaceutical giant.

The article Buying Pfizer Stock Brings a Great Dividend originally appeared on Fool.com and is written by Dan Carroll .

Fool contributor Dan Carroll has no position in any stocks mentioned. The Motley Fool recommends Johnson & Johnson. The Motley Fool owns shares of Johnson & Johnson.

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