Core Viewpoint - Long-term dividend stocks are generally more stable and provide consistent dividends due to their established nature and lower volatility compared to the broader market [1][2] Group 1: Waste Management - Waste Management Inc. is a significant player in the waste and recyclables collection industry, with a market capitalization exceeding $92 billion [4] - The company has a dividend yield of 1.40%, an annual dividend of $3.30, and a 22-year track record of increasing dividends, with a payout ratio of 48.96% [5] - In the second quarter of 2025, Waste Management reported a 19% year-over-year increase in revenue, alongside strong earnings per share (EPS) [6] - Operating expenses have decreased to less than 60% of revenue, contributing to a solid free cash flow projection of nearly $3 billion for the year [7] Group 2: Eversource Energy - Eversource Energy, a major utility provider in the northeast, has a dividend yield of 4.63% and an annual dividend of $3.01, but a high payout ratio of 129.18% [9] - The company managed to slightly increase its EPS to 96 cents, surpassing analyst expectations, and reaffirmed its full-year EPS guidance [10] - Eversource's revenue grew by 12% year-over-year, although it fell short of predictions, with a permanent rate increase in New Hampshire expected to provide stability [11] Group 3: Johnson & Johnson - Johnson & Johnson boasts a dividend yield of 3.00%, an annual dividend of $5.20, and an impressive 64-year history of dividend increases, with a payout ratio of 55.61% [12][13] - The company exceeded EPS predictions by 9 cents and revenue estimates by nearly $900 million in its mid-July earnings report [13] - Growth is driven by its innovative medicine business, particularly in oncology, with potential peak sales of $5 billion for its drug candidate TAR200 [14]

Market Overview - The current market environment reflects the excesses of 2021, with volatility returning in early August, prompting considerations for more defensive positioning [2] - Job data indicates a shaky labor market, with only 73,000 jobs added in July and unemployment rising to 4.2% [3] - The Personal Consumption Expenditures (PCE) price index reached 2.6% in June, marking the highest reading since February [3] - Market indices have achieved new all-time highs, driven by strong earnings, particularly from AI hyperscalers [3][4] Company Performance - The market is increasingly concentrated, with the "Magnificent Seven" companies dominating the S&P 500, potentially overshadowing over 400 other companies [4] - Companies that reported less-than-stellar Q2 results faced significant declines in their stock prices, indicating high expectations and stretched valuations in the S&P 500 [4] Dividend Aristocrats - Dividend Aristocrats are companies in the S&P 500 with a minimum of 25 years of consecutive dividend increases, providing stability and predictable profits [6][7] - Johnson & Johnson (JNJ) has a dividend yield of 3.00%, an annual dividend of $5.20, and a 64-year track record of dividend increases, with a payout ratio of 55.61% [9][10] - Cincinnati Financial (CINF) offers a lower dividend yield of 2.32% but has a 65-year history of raising dividends and a payout ratio of 30.18%, indicating strong sustainability [12][13] - T. Rowe Price (TROW) boasts a dividend yield of 4.84% and a 39-year track record of increases, with a manageable payout ratio of 56.76% and a strong cash position [15][16]

Financial Data and Key Metrics Changes - In Q2 2025, worldwide sales reached $23.7 billion, reflecting a 4.6% increase despite a headwind from Stellara [24][25] - Net earnings for the quarter were $5.5 billion, with diluted earnings per share of $2.29, up from $1.93 a year ago [25][26] - Adjusted net earnings were $6.7 billion, with adjusted diluted earnings per share of $2.77, representing a decrease of 2.1% [26][34] Business Line Data and Key Metrics Changes - Innovative Medicine reported worldwide sales of $15.2 billion, increasing by 3.8% despite a headwind from Stellara [26][27] - MedTech achieved worldwide sales of $8.5 billion, reflecting a 6.1% increase, driven by strong performance in cardiovascular, surgery, and vision [30][31] - In oncology, DARZALEX grew by 21.5%, while CARVICTI saw over 100% growth [27][28] Market Data and Key Metrics Changes - U.S. sales growth was 7.6%, while international sales experienced a decline of 1.6% due to Stellara biosimilars and COVID-19 vaccine impacts [26][27] - The cardiovascular segment in MedTech delivered over 22% operational sales growth, driven by new product performance [18][30] Company Strategy and Development Direction - The company aims to become the number one oncology company by 2030, targeting over $50 billion in sales [11][72] - Focus areas include oncology, immunology, neuroscience, cardiovascular, surgery, and vision, with a commitment to innovation and addressing unmet medical needs [10][21] - The company plans to launch several new products and therapies in the second half of 2025, including TAR200 for bladder cancer and subcutaneous Ribrovant for lung cancer [49][50] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving and potentially exceeding growth targets for 2025, driven by strong performance in both Innovative Medicine and MedTech [39][42] - The company anticipates an acceleration in operational sales growth in the second half of the year, supported by new product launches and market share gains [42][60] - Management highlighted the importance of navigating external challenges while maintaining financial commitments and delivering shareholder value [51][52] Other Important Information - The company raised its full-year sales guidance by $2 billion and EPS guidance by $0.25, reflecting strong Q2 performance [9][42] - The effective tax rate for the quarter was 14.7%, down from 18.5% in the previous year [35][36] - The company ended Q2 with $19 billion in cash and marketable securities and $51 billion in debt, resulting in a net debt position of $32 billion [40] Q&A Session Summary Question: Drivers of upside to guidance for the year - Management indicated that both Innovative Medicine and MedTech contributed to strong performance, with notable growth in brands like DARZALEX and CARVICTI [54][55] Question: Oncology target of $50 billion by the end of the decade - Management expressed confidence in achieving the target, citing strong growth in multiple myeloma and the potential of TAR200 for bladder cancer [70][72] Question: Guidance for top-line growth acceleration - Management expects 2026 to show better growth rates than 2025, driven by new product introductions and market dynamics [84][86]

Financial Data and Key Metrics Changes - In Q2 2025, worldwide sales reached $23.7 billion, reflecting a 4.6% increase despite a headwind from Stellara [23][24] - Net earnings for the quarter were $5.5 billion, with diluted earnings per share of $2.29, compared to $1.93 a year ago [24] - Adjusted net earnings were $6.7 billion, with adjusted diluted earnings per share of $2.77, representing a decrease of 2.1% year-over-year [25][32] Business Line Data and Key Metrics Changes - Innovative Medicine reported worldwide sales of $15.2 billion, increasing by 3.8% despite an 11.7% headwind from Stellara [25][26] - MedTech achieved worldwide sales of $8.5 billion, growing by 6.1%, with strong performance in cardiovascular, surgery, and vision [29][30] - In oncology, DARZALEX grew by 21.5%, while CARVICTI saw over 100% growth [26][27] - Tremfya in immunology grew by 30.1%, while Stellara declined by 43.2% due to biosimilar competition [28] Market Data and Key Metrics Changes - U.S. sales growth was 7.6%, while international sales saw a decline of 1.6% due to Stellara biosimilars and COVID-19 vaccine impacts [25][26] - Cardiovascular segment delivered over 22% operational sales growth, driven by new product performance [17][29] - Surgical vision grew by 8.9%, supported by strong performance in contact lenses and intraocular lenses [21][30] Company Strategy and Development Direction - The company aims to become the number one oncology company by 2030, targeting over $50 billion in sales [10][11] - Focus areas for growth include oncology, immunology, neuroscience, cardiovascular, surgery, and vision, with a commitment to innovation [8][12] - The company plans to launch several new products and expand its pipeline, including TAR200 for bladder cancer and icotrokinra for psoriasis [47][48] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving and potentially exceeding growth targets for 2025, driven by strong performance in both Innovative Medicine and MedTech [36][39] - The company anticipates an acceleration in operational sales growth in the second half of the year, supported by new product launches and market share gains [40][46] - Management highlighted the importance of navigating external challenges, including tariffs and competition, while maintaining a focus on innovation and market leadership [88] Other Important Information - The company ended Q2 with $19 billion in cash and marketable securities and $51 billion in debt, resulting in a net debt position of $32 billion [38] - The effective tax rate for the quarter was 14.7%, down from 18.5% in the previous year [33] - The company is committed to investing $55 billion in the U.S. over the next four years, driven by favorable tax policies [39] Q&A Session Summary Question: Drivers of upside to guidance for the year - Management indicated that both Innovative Medicine and MedTech contributed to strong performance, with notable growth in oncology and cardiovascular segments [52][53] Question: Oncology target of $50 billion by the end of the decade - Management expressed confidence in achieving this target, citing strong growth in multiple myeloma and the potential of TAR200 for bladder cancer [68][71] Question: Guidance for operational growth and operating margin improvement - Management expects 2026 to show better growth rates than 2025, with ongoing efforts to improve operating margins [81][83] Question: Impact of pharma tariffs and manufacturing capacity - Management acknowledged uncertainty regarding tariffs but emphasized ongoing investments in U.S. manufacturing and job creation [88]