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The 5 Biggest Dividend Yields In Healthcare

Some investors have shied away from healthcare companies due to the recent healthcare legislation which is systematically going into effect across the nation. Subsequently, many healthcare companies are trading at really attractive multiples and catching the eye of value investors. Furthermore, many healthcare companies provide a healthy dividend yield, which enhance returns for investors seeking additional income.

Below are five dividend paying healthcare companies that will provide returns for investors in excess of capital gains:

Abbott Laboratories (ABT) shares are trading above $56, between its 52-week low and 52-week high of $46 and $57, respectively. The company pays an annual dividend of $1.92 a share, which yield 3.4% to the current share price. Abbot has paid investors a dividend since 1983. In all, the company has paid out $23 per share in total dividends, $18 of which has been paid out since 2000. The company pays out 62% of earnings as dividends to investors; though the dividend may seem robust in the short term, investors should monitor the ratio as the dividend may not be sustainable in the long-term.

During the previous 12 months of operations, investors have enjoyed a 20% return on equity. Abbott is a large company with a market cap just shy of $90 billion. The company is trading at a price to earnings multiple of 18.7, a price to sales ratio of 2.22 and a price to book ratio of 3.5. The company has $8 billion of total cash on hand and $16.7 billion of total debt outstanding.

Pfizer (PFE) shares are trading just above $21, between its 52-week highs and lows of $22 and $16, respectively. The company pays an annual dividend of $0.88, which yields 4.20% to the current share price. Pfizer has paid its investors a dividend since 1982. In all the company has paid out almost $12 per share in total dividends, over $9 of which has been paid out since 2000. Pfizer has a high payout ratio of 63%, a high payout ratio may jeopardizes future dividend payments.

Investors have benefited from a modest return on equity of 10% throughout the last 12 months. Pfizer is an extremely large pharmaceutical with a market cap $163 billion. The company has $29 billion of total cash on hand and $41 billion of total debt outstanding. The company trades at a price to earnings multiple of 16.6, a price to sales ratio of 2.4 and a price to book ratio of 1.8.

Johnson & Johnson (JNJ) shares are trading around $65, approaching its 52-week high of $68 and above the 52-week low of $57. The company pays an annual dividend of $2.28, which yields 3.5% to the current share price. Johnson & Johnson has made consecutive dividend payments since its initial dividend payment in 1970. In all the company has paid out $21 to shareholders in the form of dividend, $16.50 of which has been paid out since 2000. Johnson & Johnson currently pays out 64% of earnings as dividends.

Investors have benefited from a 16% return on equity throughout the previous twelve months. Johnson & Johnson is a large pharmaceutical company with a diverse product line, which includes personal and baby care products. The company has a market cap of $178; the company has $31 billion of total cash on hand and only $18 billion of total debt outstanding. Shares are trading at a price to earnings multiple of 19, a price to sales ratio of 2.7 and a price to book ratio of 2.9.

Sanofi (SNY) shares are trading above $37. Within the previous 52 weeks company shares have traded as low as $31, and as high as $41. The company pays an annual dividend of $1.76 per share, which currently yields 4.7% to the share price. The company has consecutively paid a dividend since 2003, in total the company has paid out $10.30 to investors in the form of dividends.

Investors have benefited from a modest 11% return on equity throughout the previous twelve months. Sanofi has a market cap of almost $100 billion; the company has total cash of $5.5 billion on hand and total debt outstanding of $20 billion. Shares are currently trading a price to earnings multiple of 13, price to sales ratio of 2.1 and a price to book ratio of 1.3.

Novartis AG (NVS) shares are trading below $57, between its 52-week low and high of $51 and $65, respectively. The company pays an annual dividend of $1.60 a share, which yields 2.8% to the current share price. The company has paid an annual dividend since 2000; in total the company has paid its investors $13 in the form of dividends over the last 12 years. Novartis currently pays out 53% of earnings as dividends.

Investors have enjoyed a 14% return on equity over the previous twelve months of operations. Novartis is a large company with a market cap of $136 billion. The company has almost $5 billion of cash on hand and $20 billion of total debt outstanding. Shares are currently trading at a price to earnings multiple of 15, a price to sales ratio of 2.3 and a price to book ratio of 2.1.

About the author:

StockCroc
I'm mostly interested in income investing using dividends, preferred stocks and other debt instruments, and pair trading.

I fundamentally analyze every business from the top down.

In my personal life, I have a strong Jewish faith and enjoy playing Scrabble and entrepreneurship.

Visit StockCroc's Website


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