Dividend investing remains one of the most reliable strategies for growing wealth and generating passive income. Whether you’re a seasoned investor or just starting, dividend stocks can provide a steady stream of returns while offering the potential for capital appreciation. The choice often boils down to two paths: seeking businesses with rapid dividend growth (but often lower yields) or focusing on high-yield stocks (though these may carry greater risk).
If you’re looking for a blend of these two approaches, AbbVie (NYSE: ABBV) and W.P. Carey (NYSE: WPC) are standout choices for 2025. With just $250, you can invest in these resilient, income-generating companies and set the foundation for long-term financial gains.
1. AbbVie: A Biopharma Giant Built for Dividend Growth
AbbVie has been a dividend investor's dream since its 2013 spinoff from Abbott Laboratories. Over the past decade, the company has raised its dividend by an impressive 310%, demonstrating its commitment to rewarding shareholders. Despite its consistent growth, AbbVie still offers an attractive dividend yield of around 3.6% at recent prices, making it a standout option for investors seeking a balance of income and growth.
Why AbbVie Is a No-Brainer Dividend Stock
AbbVie’s ability to consistently grow its dividend stems from a robust portfolio of high-performing drugs and innovative research and development. Here’s what makes this company a must-have for dividend investors in 2025:
A Resilient Drug Portfolio
AbbVie’s flagship drug, Skyrizi, has become a market leader in treating psoriasis since its 2019 launch. The drug generated $7.9 billion in revenue during the first nine months of 2024, reflecting a 48% year-over-year growth. Another standout is Rinvoq, an arthritis treatment launched the same year, with sales climbing 52% to $4.1 billion over the same period.
These blockbuster drugs more than compensate for revenue declines from AbbVie’s older products, such as Humira, which faces competition from biosimilars.
A Promising Pipeline
In 2023, AbbVie invested $8.7 billion in Cerevel Therapeutics, a bold move that seemed questionable after initial setbacks with the schizophrenia drug Emraclidine. However, Cerevel’s Tavapadon, a novel treatment for Parkinson’s disease, delivered positive results in its phase 3 trials. If approved, Tavapadon could generate billions in annual revenue, further strengthening AbbVie’s cash flow.
Sustainable Dividend Growth
AbbVie’s free cash flow over the past 12 months reached $15.6 billion, and the company used just 70% of this to cover its dividend obligations. This conservative payout ratio, combined with the growth potential of Skyrizi, Rinvoq, and Tavapadon, suggests AbbVie can sustain and even accelerate dividend increases in the years ahead.
Why Now Is the Time to Buy AbbVie
Despite its strong fundamentals, AbbVie’s stock has faced recent pressure due to concerns over its Cerevel investment and broader market trends. These temporary challenges present a prime opportunity for long-term investors to acquire shares at an attractive price. AbbVie’s track record of innovation, robust drug pipeline, and commitment to shareholder returns make it a no-brainer buy for 2025.
2. W.P. Carey: A High-Yield REIT with Stability
Real estate investment trusts (REITs) are a popular choice for dividend investors because they are legally required to distribute at least 90% of their taxable income to shareholders. W.P. Carey, one of the most diversified REITs in the market, is a standout performer with a 6.4% dividend yield, offering investors a compelling opportunity for high income and long-term growth.
What Sets W.P. Carey Apart
W.P. Carey specializes in net-lease agreements, where tenants are responsible for property taxes, insurance, and maintenance. This business model provides steady cash flow and reduces the REIT’s exposure to fluctuating operating expenses. Here’s why W.P. Carey is an excellent pick for 2025:
A Diversified Portfolio
W.P. Carey’s portfolio spans industrial, retail, warehouse, and self-storage properties. Its largest tenant, Extra Space Storage, contributes just 2.7% of the REIT’s annualized base rent, highlighting the company’s diversification and resilience to economic downturns.
Navigating Challenges
In 2023, W.P. Carey made the strategic decision to spin off its office properties into a separate entity. While this move resulted in a temporary dividend cut, it strengthened the REIT’s overall portfolio by reducing its exposure to declining office rents. Since then, W.P. Carey has raised its dividend four times, signaling its commitment to shareholders.
Strong Financials and Dividend Sustainability
Despite the challenges of rising interest rates, W.P. Carey remains on solid financial footing. The REIT’s adjusted funds from operations (AFFO), a key metric for evaluating REITs, is expected to reach $4.68 per share in 2025. With an annual dividend payout of just $3.52 per share, there’s plenty of room for further increases.
Why Now Is the Time to Buy W.P. Carey
W.P. Carey’s stock price has been under pressure due to macroeconomic factors, such as rising Treasury yields, which often lead to a sell-off in income-generating assets like REITs. However, these short-term fluctuations create a compelling entry point for long-term investors.
With a high dividend yield, a diversified portfolio, and a track record of managing challenges effectively, W.P. Carey is well-positioned to deliver stable returns in 2025 and beyond.
How to Invest $250 in These Dividend Stocks
Even with a modest investment of $250, you can start building a portfolio that generates passive income and offers growth potential. Here’s how you might allocate your investment:
AbbVie (50% Allocation): Use $125 to purchase AbbVie shares. This provides exposure to a rapidly growing biopharma company with a strong dividend history and a promising pipeline.
W.P. Carey (50% Allocation): Invest the remaining $125 in W.P. Carey. This allocation ensures a high dividend yield and diversification through a stable, income-generating REIT.
Final Thoughts
Investing in dividend stocks like AbbVie and W.P. Carey offers a powerful combination of income and growth. These companies are leaders in their respective industries, with strong fundamentals and a commitment to rewarding shareholders. By investing $250 in these no-brainer stocks, you can take advantage of current market opportunities and lay the groundwork for long-term financial success.
As always, ensure your investments align with your financial goals and risk tolerance. Whether you’re seeking passive income, portfolio diversification, or both, AbbVie and W.P. Carey are compelling choices to consider in 2025.