Intuitive Surgical (ISRG) is an intriguing every thing-proof inventory for Trump 2.0. The corporate makes a speciality of cutting-edge surgical units and no matter what the Fed or President-Elect Trump does in 2025, we know that People will proceed to have surgical procedures.
Human surgeons are costly and susceptible to errors, so the massive pattern within the surgical procedure room is in the direction of robotics. Intuitive created the da Vinci system, probably the most extensively used surgical robotic on the planet.
Enterprise is booming. The corporate anticipates 12% to 16% year-over-year demand progress for da Vinci. Its expertise is much less invasive and extra exact than people, which ends up in sooner restoration occasions for sufferers. The corporate simply launched da Vinci 5, which has already been utilized in over 12,000 procedures.
The Physician is In
ISRG shareholders had a area day throughout Trump 1.0. The inventory returned 179%. Why would not historical past repeat, or at the very least rhyme, and reward traders with one other double or higher?
The bummer for us dividend traders is that Intuitive would not pay one. Now, we might manufacture a payout by shopping for the inventory and promoting coated calls. However that may be a ache.
At this time, name choices with strike costs simply above ISRG’s present value fetch a $10+/share premium. They expire later this month. So we might purchase the inventory, promote (“write”) these coated calls, and pocket the two% premium.
Then, we rinse and repeat in February. And March. And so forth.
We all know this technique. However it’s a grind. Why not outsource it to, say, a fund supervisor?
Moderately than spending the remainder of our lives writing coated calls, we’re going to discover a “backdoor” payout play on ISRG. It nets us a 14.3% yearly dividend, paid month-to-month.
Higher but, there aren’t any month-to-month check-ins from our aspect. We purchase the fund as soon as and supervisor Dr. Erin Xie and her staff do the remainder of the work.
All we do is purchase the closed-end fund (CEF) BlackRock Well being Sciences Belief (BMEZ). ISRG is Dr. Xie’s prime holding at 4.6% of the portfolio.
What a decide! The physician’s fund BMEZ have to be rallying in anticipation of Trump 2.0, proper?
Mistaken! Quite the opposite, the fund sits within the cut price bin, consider it or not. BMEZ trades at a 9% low cost to the worth of its property.
In different phrases, we’re in a position to snag this high-yield bounty for simply 91 cents on the greenback. We’re “up” 9% with out breaking a sweat.
Why the candy dividend deal? On the marketing campaign path, Trump mentioned he was going to let former candidate turned supporter Robert F. Kennedy Jr. “go wild on well being.” A giant “uh oh” for healthcare shares?
The Wall Road fits did not wait round to search out out. They’ve dumped something and every thing healthcare because the election and particularly since RFK was nominated to run the Division of Well being and Human Providers.
Massive pharma has particularly been a sizzling potato as a result of Trump additionally mentioned of RFK at a rally: “I’ll let him go wild on medicines.”
However Intuitive isn’t a drugs peddler. It’s a surgical robotics innovator. Emotional traders will throw out a complete sector willy-nilly. So, the BMEZ selloff makes precisely zero sense.
The identical logic extends to BMEZ’s prime 5 holdings. Try how they carried out as a bunch throughout Trump 1.0!
BMEZ Holdings Boomed 
These are all firms that profit from much less regulation. They returned 126%, 141%, 179%, 227% and over 1,000% through the first 4 years underneath Trump!
BMEZ is a neat method for us revenue traders to purchase the basket, plus some. Dr. Xie’s staff sells coated calls on its holdings to generate more money. Higher BlackRock than us! We do not want the month-to-month choices headache. Nor the lengthy separate tax invoice!
The coated name revenue powers the massive payout. Plus, we’ve value upside through a possible “rhyme” of Trump 1.0 for inventory holdings like Intuitive.
The healthcare sector-at-large is reasonable and BMEZ is a straight-up cut price at simply 91 cents on the greenback.
Not solely that, but in addition traders simply obtained a modest dividend elevate. BMEZ dished a $0.17809 dividend in December, elevating the fund’s yield to 14.3%. Once more, that’s paid month-to-month. (The elevate was a part of BlackRock’s managed distribution play for the fund, which targets an annualized 12% payout–mission completed, BR.)
This contrarian revenue delight flies underneath the radar in CEFland. Signal us up for the massive dividend and beneficiant low cost.
The addition of BMEZ to our Contrarian Revenue Report portfolio completes a lovely Revenue Calendar image. The “Dividend Mona Lisa” under displays our CIR lineup of 23 large payers. They boast a projected 12-month yield of 8.49% for an revenue stream of $84,912.81:
Revenue Calendar: $84,912.81 in Divvies for 2025
Better of all, most of those positions pay their dividends monthly. Need extra high-yield names and tickers? Click here for my full list of favorite monthly dividend payers.
Additionally 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 writer and don’t essentially replicate these of Nasdaq, Inc.
