Passive income is essential in retirement, but building a dependable stream isn't easy. Fortunately, top-tier dividend stocks can do the heavy lifting. The key is focusing on companies with strong yields, reliable payouts, and recession-resistant business models.

In today's volatile market, where uncertainty is the only constant, dividend investing has regained its shine. High-quality stocks that return capital to shareholders offer income stability and a cushion against downside risk.

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The healthcare sector stands out in this environment. Its essential nature and steady demand make it a natural haven and a fertile ground for income investors.

Two healthcare heavyweights screen as particularly attractive buys in this turbulent market. With generous yields, durable business models, and products the world can't live without, these stocks deliver a potent mix of income and long-term upside. Here's why they belong on your radar right now.

Pfizer: Pharmaceutical giant with an exceptional yield

Pfizer (NYSE: PFE) shares currently offer an eye-catching 7.8% dividend yield, putting this pharmaceutical titan among the highest-yielding stocks in the healthcare sector. This exceptional payout level reflects the market's concerns about the company's growth trajectory following the pandemic revenue boom. With shares trading at just 7.5 times forward earnings, investors are essentially being paid handsomely to wait for the company's next phase of growth.

While Pfizer's payout ratio stands at an elevated 119%, high payout ratios are commonplace in the pharmaceutical industry due to its inherently cyclical nature. Moreover, the company maintains one of the strongest balance sheets in the industry following its COVID windfall, providing ample financial flexibility to sustain its dividend while investing in future growth. Pfizer's diverse portfolio of patent-protected drugs also generates enormous cash flows that support shareholder rewards and ongoing research initiatives.

What's the core value proposition? The drugmaker faces potential policy tailwinds under the new administration, which has signaled interest in correcting the "pill penalty" that currently gives small-molecule drugs just nine years of protection from Medicare negotiation versus 13 years for biologics. Such a change could enhance the economics of Pfizer's substantial small-molecule research programs.

Additionally, Pfizer's decision to divest its off-patent division has resulted in a more focused, innovative organization better positioned for long-term growth. So, with a promising pipeline of new drugs in cancer and immunology, Pfizer offers income investors not just an exceptional current yield but also the potential for meaningful capital appreciation as new blockbuster treatments leave the lab and enter commercial production.

AbbVie: Diversified pharmaceutical giant with steady income

AbbVie (NYSE: ABBV) offers investors a 3.9% dividend yield right now, with shares trading at a forward price-to-earnings ratio of just 14. For context, the benchmark S&P 500 trades at around 19 times forward earnings estimates. The drugmaker has successfully built a diversified portfolio spanning immunology, oncology, and aesthetics that generates consistent cash flow to support shareholder returns.

Humira's loss of exclusivity has created headwinds as biosimilar competition erodes market share. However, AbbVie's newer immunology treatments, Skyrizi and Rinvoq, have demonstrated stronger clinical outcomes for psoriasis, rheumatoid arthritis, and Crohn's disease than conventional therapies. The market has responded favorably to these medications, helping to counterbalance Humira's declining sales.

Beyond immunology, AbbVie maintains strong positions in aesthetics with Botox and oncology with Imbruvica, providing revenue diversification that strengthens the company's overall financial stability. This multifaceted portfolio approach reduces dependence on any single product while creating multiple avenues for future growth.

Despite an elevated payout ratio of 259%, AbbVie's dividend remains well supported by consistent cash-flow generation from its broad product lineup. For income investors seeking healthcare exposure with reliable dividends, AbbVie offers a generous yield with the potential for moderate capital appreciation, as it fortifies its core immunology franchise and expands into other lucrative market segments.

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George Budwell has positions in AbbVie and Pfizer. The Motley Fool has positions in and recommends AbbVie and Pfizer. The Motley Fool has a disclosure policy.

With equity markets in shambles due to President Donald Trump's trade policies, now might be as good a time as any to invest in excellent dividend stocks.

For one, dividend-paying companies tend to be more resilient than their non-dividend-paying peers. They are more likely to emerge from challenging economic periods in one piece. Second, their regular payouts can help smooth out losses during a downturn. That's precisely what some investors are looking for in this uncertain environment.

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With that said, let's consider two top dividend stocks that should navigate the current storm relatively well and continue performing long after: AbbVie (NYSE: ABBV) and Gilead Sciences (NASDAQ: GILD).

1. AbbVie

AbbVie went public in 2013, splitting from its former parent company, Abbott Laboratories. Since then, the drugmaker has produced market-beating returns.

ABBV Total Return Level data by YCharts

More importantly, the stock has the qualities of a forever investment. AbbVie consistently develops newer medicines to replace older, off-patent ones. It recently successfully navigated the most significant patent cliff in the history of the pharmaceutical industry. The company's rheumatoid arthritis drug Humira, the most lucrative therapy ever, lost U.S. patent exclusivity in early 2023. AbbVie returned to top-line growth last year, and investors can expect it to maintain that momentum.

The drugmaker expects its two immunology superstars, Skyrizi and Rinvoq, to generate about $31 billion in sales by 2027 (they should rack up about $24 billion this year). Humira's sales peaked at $21.2 billion. Further, Skyrizi and Rinvoq should continue their northbound trajectory well into the next decade. These two medicines are more than filling Humira's shoes.

They will eventually run out of patent protection, but AbbVie can handle the most serious patent cliffs as it did with Humira. The company does have other growth drivers -- including its Botox franchise -- not to mention a deep pipeline.

What about its dividend? When counting the time it spent under Abbott Laboratories, AbbVie has increased its payouts for 53 consecutive years. It's not like the drugmaker has been slacking off since 2013, either; its payouts have grown by 310% since its IPO. The stock offers a juicy forward yield of 3.5% and a reasonable cash payout ratio of just under 62%.

AbbVie looks like a fantastic dividend stock to buy and hold for a long time.

2. Gilead Sciences

Gilead Sciences is a leading biotech company that develops products across several therapeutic areas. The company is best known for its work in the HIV drug market, where it is arguably the leader. Last year, Gilead's Biktarvy -- the top-selling HIV regimen in the U.S. -- generated $13.4 billion in sales, 13% higher than the previous fiscal year. Descovy, used for the treatment and prevention of HIV (a leader in the PrEP niche) racked up $2.1 billion in sales, an increase of 6%.

Some might argue that Gilead Sciences is too dependent on its HIV portfolio, which recorded total revenue of $19.6 billion last year, up 8% year over year. The biotech's top line grew 6% to $28.8 billion in 2024. However, the company has been ramping up other parts of its business. Its oncology and liver disease units have grown faster in recent quarters, though they still make up a relatively small portion of its revenue compared to HIV. These other segments should grow in prominence in the coming years.

Gilead Sciences' pipeline features about 30 oncology clinical trials, including several phase 3 studies. And while Veklury -- Gilead Sciences' coronavirus medicine -- had a negative impact on its revenue growth in 2024, the medicine hardly features in the drugmaker's long-term growth plans. Veklury's sales have fluctuated significantly in the past few years.

However, its core franchises -- HIV, oncology, and liver disease -- have slowly and steadily moved in the right direction. In the long run, the company should significantly expand its lineup and continue delivering strong financial results.

Lastly, Gilead Sciences has an attractive dividend track record. The company has increased its payouts by almost 84% in the past 10 years. Its forward yield of 3% and cash payout ratio of 38% look competitive. Income-seeking investors can safely add this stock to their portfolios for good.

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From TV star to powerful government official. That's the path taken by President Donald Trump and his new administrator of the Centers for Medicare and Medicaid Services (CMS) -- Dr. Mehmet Oz.

Oz was a heart surgeon and medical school professor for years. He achieved fame thanks to frequent appearances on The Oprah Winfrey Show, which led to his hosting his own TV program, The Dr. Oz Show. Oz ran unsuccessfully for a U.S. Senate seat in Pennsylvania in 2022.

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But that didn't end his political career. The Senate officially confirmed Oz to head CMS on April 3. Here's what retirees need to know so far.

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1. Oz's confirmation went along party lines

All 53 Republican senators voted to confirm Oz to head CMS. None of the 45 Democratic senators voted for his confirmation. What were the minority party's objections to having Oz run CMS?

For one thing, some Democrats were concerned about Oz's potential conflicts of interest. He has disclosed investments in big drugmakers AbbVie and Eli Lilly and giant health insurer UnitedHealth Group, among others. These healthcare companies receive payments from Medicare. Oz did commit to divesting any financial interests in these companies.

There were also questions raised during Oz's Senate confirmation hearing about his past support for controversial therapies. For example, ranking Democratic member of the Senate Finance Committee, Sen. Ron Wyden of Oregon, asked Oz about his advocacy of green coffee extract, which the senator said was fraudently marketed as a "miracle weight-loss drug."

Probably the biggest objection to Oz's confirmation, though, was that he wouldn't commit to fighting attempts to cut Medicaid.

2. Oz has previously promoted Medicare Advantage

Oz has been a longtime proponent of Medicare Advantage plans. He and former Kaiser Permanente CEO George Halvorson proposed expanding Medicare Advantage because they believed it's better than traditional Medicare.

It remains to be seen how aggressively Oz will promote Medicare Advantage now that he's running CMS. During his Senate confirmation hearing, he promised to "go after" a fraudulent practice that can be problematic for Medicare Advantage called upcoding, by which healthcare providers file claims for more expensive procedures or diagnoses than the actual procedure or diagnosis to receive a higher reimbursement from Medicare.

3. What Oz says his Medicare priorities are

Oz acknowledged several problems for Medicare during his confirmation hearing, including the fact that healthcare costs are growing faster than the economy and that the Medicare Trust Fund will run out of money within the next decade. He told the told the Senate Finance Committee that he had three top priorities as the administrator of CMS.

First, Oz wants to "empower beneficiaries with better tools and more transparency, so the American people can better navigate their health, as well as dealing with the complex healthcare system we have created for them." He specifically mentioned increasing transparency related to prescription drug costs.

Second, he wants to provide incentives to healthcare providers to "optimize care." Oz thinks that using artificial intelligence (AI) can "liberate doctors and nurses from all the paperwork" and allow them to focus more on patients.

Third, Oz plans to aggressively reduce waste, fraud, and abuse with Medicare and Medicaid. The previously mentioned upcoding issue was one area that he discussed targeting.

4. There has been one Medicare surprise so far

Oz has been at the helm of CMS for less than a week. There has already been one Medicare surprise. On April 8, 2025, CMS announced a higher-than-expected payment increase for Medicare Advantage plans. It's unclear if Oz was involved in the decision, but the move could indicate that he'll continue his previous support for Medicare Advantage plans as head of CMS.

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Keith Speights has positions in AbbVie. The Motley Fool has positions in and recommends AbbVie. The Motley Fool recommends UnitedHealth Group. The Motley Fool has a disclosure policy.