Key Takeaways
- AbbVie raised its quarterly dividend 5.2% to $1.82 a share on Oct. 30, and Chevron reported third-quarter earnings of $9.9 billion the same day.
- Chevron yields 3.2% and paid out 41% of its free cash flow as dividends over the past year, against a 2.5% yield and 65% for AbbVie.
- AbbVie has the faster-growing business, led by Skyrizi, but its cash dividend payout ratio has climbed from 41% to 65% since fiscal 2022.
- Oil prices and Chevron’s 2027 capital plan, due in December, are the things to watch.
AbbVie (ABBV) raised its quarterly dividend 5.2% on Oct. 30, to $1.82 a share.
The same day, Chevron (CVX) reported third-quarter earnings of $9.9 billion, up from $3.5 billion a year earlier. Its dividend is still the $1.78 a quarter it set at the start of 2026.
One pays more today, and the other has the faster-growing business. If I can only hold one of them for the next 10 years, which should it be?
| Metric | AbbVie (ABBV) | Chevron (CVX) |
|---|---|---|
| Dividend yield | 2.5% | 3.2% |
| Dividend growth, 5 years | 6.6% a year (fiscal 2020-2025) | 5.8% a year (fiscal 2020-2025) |
| Record | Quarterly dividend up 355% since 2013; S&P Dividend Aristocrat | 39 consecutive years of raises |
| Cash dividend payout ratio (TTM to Sept. 30, 2026) | 65% | 41% |
| Net debt / EBITDA (LTM) | 2.0x | 0.5x |
| Interest coverage (LTM) | 8.2x | 25.2x |
Source: TIKR, as of Nov. 5, 2026; records are each company’s own.
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AbbVie is growing past Humira
AbbVie’s third-quarter net revenue rose 10.3% from a year earlier, to $17.4 billion. Skyrizi grew 22.7% to $5.78 billion, more than making up for Humira, which fell 31.2% to $683 million. On Oct. 30, AbbVie also raised its 2026 adjusted EPS guidance to $13.95-$13.99, from $13.76-$13.96.
The dividend has gotten a little tighter. Free cash flow fell from $24.3 billion in fiscal 2022 to $17.8 billion in fiscal 2025, while dividends paid rose from $10.0 billion to $11.7 billion:
That took the cash dividend payout ratio from 41% in fiscal 2022 to a manageable 65% in fiscal 2025. It was still 65% over the twelve months to Sept. 30, 2026.
CEO Robert Michael said on the third-quarter call that he expects future deals “to be more bolt-on additions versus a large transformational deal like Allergan.” That’s good news for the cash. But the latest 5.2% raise came in below AbbVie’s 6.6% yearly pace from fiscal 2020 to fiscal 2025. My guess is that slower raises are the price of that thinner cushion.
Chevron’s cash comes and goes with oil
Chevron’s dividend has more room than AbbVie’s, though it rests on a far bumpier stream of cash. Over the twelve months to Sept. 30, 2026, dividends took a well-covered 41% of free cash flow.
That’s after a third quarter in which free cash flow more than doubled, to $12.0 billion from $4.9 billion a year earlier. In fiscal 2024 and fiscal 2025, the payout ran a much tighter 78% and 77%. In fiscal 2016 and fiscal 2020, free cash flow didn’t cover the dividend at all:
On the third-quarter call, CFO Eimear Bonner said “the first priority within that is to grow the dividend consistently.”
It’s also cleaning up its books. On Oct. 6, Chevron agreed to trade its stakes in Hess Midstream and its DJ Basin crude pipelines for $200 million in cash and better Bakken contract terms. The deal takes about $3.7 billion of Hess Midstream’s debt off its balance sheet.
The risk is oil prices themselves. Chevron pointed to a $64-a-barrel swing within a single quarter.
So which dividend wins?
If I can only own one dividend stock for the next 10 years, it’s Chevron.
At each company’s five-year dividend growth rate, $10,000 in Chevron today would pay about $4,178 over the decade, against about $3,383 from AbbVie. At those rates, AbbVie’s income wouldn’t catch Chevron’s for more than 30 years.
The bigger question is whether Chevron can keep growing its dividend at 5.8% a year. Its balance sheet says it can. In fiscal 2016 and fiscal 2020, net debt climbed to 2.9x and 3.2x EBITDA. It ended fiscal 2025 at 1.1x and has since dropped to 0.5x, after Chevron cut net debt by $7.8 billion in the third quarter alone:
I’m confident that’s enough room to carry the dividend through the next oil bust.
This isn’t to say AbbVie’s dividend is in trouble. Its free cash flow has covered the dividend every year since fiscal 2016, Skyrizi is growing fast, and management just raised guidance again. It’s just that AbbVie pays less today, has less cash to spare, and carries more debt. I’d rather own the bigger check from the company with more room to keep raising it.
Of course, Chevron will share more on its 2027 capital program in December, and it expects exploration spending next year to rise 50% from 2025’s level. If that spending climbs while oil falls, the payout could drift back toward its fiscal 2024 level.
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Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any of the stocks mentioned. Thank you for reading, and happy investing!
