Potential Stock Gains Amid North American Trade Concerns

With Canada and Mexico under scrutiny due to tariff changes, companies with supply chains outside of North America are likely to benefit. This could provide opportunities for investors to turn their focus to dividend-growing stocks that stand to gain.

In this article, we explore two promising dividend stocks. One has a supply chain unaffected by the recent trade issues, while the other faces identity concerns stemming from current political sentiments. Historically, both stocks posted impressive returns of 138% and 199% during Trump’s first term, hinting that we could see similar opportunities in the current political landscape.

Our first stock, Analog Devices (ADI), is currently down 9% from its recent highs due to trade anxiety, but these concerns are exaggerated. The company has a robust U.S. manufacturing base, featuring four facilities, and a strong presence in Europe and Southeast Asia, which are outside the tariff line of fire.

ADI is a manufacturer of semiconductor chips used across various sectors, including industrial, automotive, consumer, and communication applications. The company plays a crucial role in merging our physical and digital environments.

In a forward-thinking partnership, ADI worked with Waymo on radar technology to measure the distance and speed of objects. Waymo is expanding its self-driving car operations in cities like San Francisco, Phoenix, and Los Angeles, with plans for Austin and Atlanta in 2025. These autonomous vehicles will rely on the precision chips from ADI, marking automotive automation as a significant growth sector.

Moreover, ADI’s influence extends to personal health monitoring. Many wearables, such as fitness trackers or smart rings, utilize ADI’s analog front-end chips to monitor vital statistics like heart rate and blood oxygen levels. Increasingly sophisticated health wearables are becoming integral to our routines—my sleep tracker often alerts me when I’m getting sick before I even realize it!

No single customer contributes more than 10% of ADI’s revenue, showcasing its diversified portfolio that benefits shareholders through consistent dividend growth. Over the past decade, ADI has increased its dividend payout by an impressive 149%:

ADI’s Ever-Rising Divvie

Despite hopes for growth similar to Nvidia, ADI’s stocks remain undervalued—a dip of 15% over the summer has left ADI at a 9% discount from its July highs. The fears surrounding tariffs may distract from ADI’s solid foundation. Historically, the company thrived during Trump’s first term, and it is poised for another impressive run under the potential upcoming administration.

ADI Returned 138% During Trump 1.0

Shifting from technology to healthcare, investors have been skittish about Abbott Laboratories (ABT) since news of a potential political shift. With Robert F. Kennedy Jr. hinted to head the Department of Health and Human Services, many investors are reconsidering their positions in healthcare. However, that may be an overreaction.

Abbott has shown resilience in the past; it delivered a 199% return during Trump’s first term. The company has not only maintained its profitability but is now trading 8% below its recent highs driven by RFK concerns, and 15% lower than its all-time highs from late 2021.

What drove Abbott’s stock surge in ’21? A pandemic-related surge in rapid testing. Each usage, whether mandated or chosen by consumers, directly translated into sales, contributing to a growth in revenue from $32 billion to $45.5 billion over a little more than two years.

But the boom in testing sales has waned as pandemic stress has eased. Investors have subsequently moved on, dismissing Abbott along with their old testing materials. Nevertheless, Abbott had already strategized its next chapter focusing on continuous glucose monitoring (CGM)—a fast-growing market not solely for diabetics but also for those interested in health optimization. The introduction of Abbott’s Lingo system, available without a prescription, exemplifies this strategy.

Consider watching the Netflix documentary Don’t Die for an insight into the future of preventative medicine featuring Bryan Johnson, who is optimizing personal health metrics, highlighting a growing focus on optimal health standards over merely acceptable ones. Such trends signal a rise in demand for CGM technology, which puts Abbott in a strong position for future growth following its successful run under Trump 1.0, where it returned 199%:

ABT Returned 199% During Trump 1.0

Conclusion: ADI and ABT emerge as well-positioned dividend stocks, potentially thriving in the anticipated market conditions of 2025. For additional insights, please click here to explore my comprehensive “Made for 2025 Dividend Plan,” detailing five top stock picks for the coming years.

Also see:

• Warren Buffett Dividend Stocks
• Dividend Growth Stocks: 25 Aristocrats
• Future Dividend Aristocrats: Close Contenders

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.