Allergan is a drug company with a diverse product base. Treating eye problems, migraines, and cosmetic aesthetics, AGN’s products are tied to an aging population. As baby boomers continue to get older, their vision degrades… but their vanity doesn’t. Allergan takes advantage of this growing consumer base by reapplying several current treatments for new issues. For example, botox is not merely used as an aesthetic treatment, but also for migraines now too. Also, AGN was recently approved as the only FDA approved treatment for dry eye, a condition that 9 million people suffer from in the US.
So, as Allergan continues to reinvest in research and development (RND), they continue to ebb away at the share… which is why they pay such a small dividend. In fact, 16% of sales go directly back into their RND… making it a growth stock of sorts. And their international expansion is growing at 2 to 3 times the domestic sales growth rate. So, if you’re looking for a health care stock with a little twist on the appeal to vanity, Allergan may just be what the doctor ordered!