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One for migraines. Two for headaches.
Published about 16 hours ago • 9 min read
As I write this, my wife Jena is down with a migraine.
She has had them her whole life, and if you’ve never had one, it can literally wipe out a whole day.
And I wish there were a simple way just to make it stop for her.
That got me thinking about something I have heard said about investing. Some of the best companies to look at for the long term are the ones that solve migraine-level problems.
The kind of problem people will gladly pay to make go away, over and over again.
So I found a few companies like that that also pay a dividend with room to spare, and have a real shot at growing it for a long time.
I’m not going to bury you in research here. This is just me putting three names on your radar. If one of them grabs you, you can dig in deeper on your own. That is the fun part anyway.
AbbVie is still a pretty young company because it was spun off from Abbott Laboratories in 2013, and it took the drug Humira with it. Humira went on to become the best-selling drug in the world.
In 2020, AbbVie bought Allergan, the company behind Botox. That deal is a big reason AbbVie is the migraine company.
They have Qulipta, a pill you take to help prevent migraines. They have Ubrelvy, for when a migraine hits and you need to treat it right then. And Botox is approved to help prevent headaches in people with chronic migraine, people who deal with this stuff half the month or more.
AbbVie has a hand in migraine prevention, treatment, and the worst chronic cases.
Full disclosure, I own shares of AbbVie.
Simply Safe Dividends gives AbbVie a Dividend Safety Score of 80 SAFE, and it currently pays a 2.50% yield. The last raise was 5.2%. Over the last 5 years, the dividend has grown about 6.6% a year, and over the last 10 years about 12.2% a year. Simply Safe counts a 54-year growth streak for AbbVie, giving it credit for Abbott's long history before the spin-off.
SimplySafeDividends.com
Interestingly, neither tool I use thinks AbbVie is cheap right now. SimplySafeDividends.com says it could be overvalued, with an expected range of $180 to $220, while the stock sits at $291.31. AlphaSpread.com puts its base-case value at $250.84, making the stock about 14% overvalued. Great company. Not a cheap price right now.
AlphaSpread.com
Next is a mostly forgotten, un-sexy company… Until their trash doesn’t get picked up.
Waste Management started in 1968 in Chicago. The basic idea was simple. Buy up a bunch of small trash haulers and build one big company. Today it is the biggest waste company in North America, serving more than 20 million customers.
Here is why I call this a migraine-level problem. Trash does not stop, even in the midst of a pandemic shutting down the world. Your house makes it every day. Restaurants make it. Hospitals make it. Cities make it. And nobody can just let it pile up.
Somebody has to pick it up, haul it, and put it somewhere safe and legal. But nobody wants a new landfill built near them. So the landfills Waste Management already owns are very hard to replace. Good luck competing with that!
The dividend has been raised for 22 years in a row. The latest raise was a big one, 14.5%. Over the last 5 years the dividend has grown about 8.6% a year, and they only pay out about half of their earnings to cover it. That leaves lots of room for growth. Simply Safe gives it a safety score of 80 SAFE, and it yields 1.60%. Super boring business. Growing dividend and my kind of company.
SimplySafeDividends.com
Simply Safe calls it reasonably valued, with an expected range of $213 to $260, and the stock at $236.26 sits right in the middle of that. Alpha Spread puts its base case at $230.04, only about 3% below the price which means it’s pretty much fairly valued for a quality company.
AlphaSpread.com
The last one is the sneaky one. And most people who’ve never run a business with payroll (like me) never think about it.
ADP stands for Automatic Data Processing, and it started way back in 1949. A young guy named Henry Taub started doing payroll by hand for small businesses in New Jersey. That was the whole business. Your people need to get paid, and getting it right is a pain, so pay us to do it.
Today ADP helps pay about 1 in 6 workers in the United States, for more than a million businesses.
Think of payroll as a migraine. Pay your people late, and they are furious. Pay them the wrong amount, and they are furious. Mess up the taxes, and now the government is involved, and there are fines. Thousands of different tax rules apply depending on where you live and work, and most business owners do not want that headache. They want to run their business. So they hand the whole mess to ADP, every single pay period, year after year.
That stickiness shows up in the dividend. Simply Safe counts 52 years of straight dividend raises for ADP. The latest raise was 10.4%. Over the last 5 years, the dividend has grown about 12.4% a year, and over the last 10 years about 12.3% a year. Its safety score is 90 VERY SAFE, and it yields 2.24%. Fifty-two straight years of dividend growth, through recessions, rate hikes, a pandemic, and the Chicago Cubs winning the World Series.
But I worry about AI with ADP.
Morningstar actually cut ADP's moat rating in 2026, partly because of AI. The fear is simple. If AI can do more of this work, do companies still need to pay ADP as much? And if companies use AI to run leaner, with fewer workers, ADP gets paid largely per worker. Fewer workers could mean slower growth.
That is a real worry.
But here is the other side, and it is why ADP is still on this list. Payroll is not just math. Math is the easy part, and AI is great at math. Payroll is math + law + blame. If it goes wrong, somebody has to answer to the IRS and to an angry employee standing in your office. My guess is most business owners won't trust that job to a brand-new AI tool they set up themselves. They outsourced it because they never wanted the job in the first place.
And ADP is not just sitting there watching AI happen. They have their own AI tools built into their products, like ADP Assist, and they sit on more payroll data than just about anybody on Earth. AI’s more likely to make ADP faster and cheaper to run than to make ADP go away. But I will be watching it, and you should too.
Simply Safe says ADP may be undervalued, with an expected range of $305 to $373, and the stock at $303.35 sits just below that. Alpha Spread says the opposite. Its base case is $257.72, which makes ADP look about 15% overvalued, even though it also says ADP is valued in line with its own history. Alpha Spread's number comes from a DCF model, and you know how I feel about those. Tweak one guess, and you are looking at a different galaxy. So I take both with a grain of salt.
alphaSpread.com
One last thing about the valuations from Simply Safe and Alpha Spread, because there is no exact value for a company. Nobody knows it. Not me. Not you. Not any websites.
I poo poo the idea that any of us can know the exact intrinsic value of a stock. Think about it. The people who run these companies have a hard time telling us what sales will look like 90 days from now. But a discounted cash flow model projects cash flows ten years into the future, plus some huge value at the very end. I just have such a hard time getting on-board with that.
Curtis Jensen, who used to be the chief investment officer at Third Avenue, said a DCF model is like the Hubble Telescope. Turn it a fraction of an inch, and you are looking at a whole different galaxy. Change one little guess in the model, and the answer changes with it.
So I keep my own check simple by looking at what a stock costs compared to its own price to earnings ratio over the last five or ten years. That at least tells me if a stock is cheap or pricey compared to itself. It is not perfect. If earnings dropped to zero tomorrow, all bets are off. But I know it is just a rough guide, and I treat it that way.
Then I ask my one big question. Do I think this company will still be here in five or ten years? And will it be making more money then than it does now, even after inflation? If that answer is a strong yes, then the price today will probably work out fine over the long run.
Price still matters though. The more you pay, the harder a company has to work to make you money. I love Costco (COST). It is a great company that’s a win for the customers, the vendors and the company. But it trades at a price to earnings ratio of around 50, and that’s nuts to me. Now, if a company is truly special, and it is going to grow a ton and make way more money down the road, it can grow into a high price. That does happen. You are just making the road a lot harder when you pay up like that.
So that is my three. One fights actual migraines. One hauls away a problem that never stops coming. And one takes a job that can get a business owner in real trouble if it goes wrong.
Now I want to hear yours. What is a company you think solves a migraine-level problem? Hit reply and tell me.
One of the leading tech investors was on the Master Investor podcast the day before the mid-term election and shared his concerns for the AI space if the Democrats swept... which they did.
The title of this grabbed me, and it was about an English kitchen cabinet company (HWDN.L), but I enjoyed that they also brought up a stock I'm acquiring - Watsco (WSO).
Disclaimer: This is not investment advice. Do your own research before making any investment decisions.
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