The company pays dividends twice a year and the current annual divided stands at $3.80 per share, yielding over 7.50%. The stock is one of the highest yielding stocks in the market. Furthermore, future growth opportunities make it an attractive dividend and growth stock.
Following different strategies
Pfizer Inc. (NYSE:PFE) operates in five segments: Primary Care, Specialty Care and Oncology, Established Products and Emerging Markets, Animal Health and Consumer Healthcare, and Nutrition. Pfizer Inc. (NYSE:PFE) is also focusing on emerging markets and sales from emerging markets increased 6% during the previous quarter.
In the face of increased competition, Pfizer Inc. (NYSE:PFE) has planned to increase its product portfolio. Current pipeline projects include Eliquis, Xeljanz, and various oncology products. Pfizer Inc. (NYSE:PFE) is also focusing on growth through acquisitions, and it was also rumored to be preparing a bid for Onyx Pharmaceuticals, Inc. (NASDAQ:ONXX). However, there are reports that the company may not go ahead with its plans to buy Onyx Pharmaceuticals, Inc. (NASDAQ:ONXX).
Moving onto the dividend — the company pays an annual dividend of $0.96 per share, yielding 3.25%. The company has been consistently increasing its dividends over the last three years. Pfizer Inc. (NYSE:PFE) has one of the best free cash flow figures in the industry. The company has generated over $15 billion in free cash flow over the past twelve months and paid $6.6 billion in dividends, which puts the payout ratio at around 43%.
Furthermore, the company also supplements dividend payments with stock repurchases — Pfizer repurchased shares worth $11 billion over the past twelve months. It is one of the best dividend picks in the sector, in my opinion.
Conclusion
All of the above mentioned companies have impressive dividend yields and attractive growth opportunities. Pfizer and GlaxoSmithKline plc (ADR) (NYSE:GSK) offer lower dividend yields compared to AstraZeneca plc (ADR) (NYSE:AZN), but these two giants have stronger free cash flows. Healthcare stocks are an attractive investment opportunity at the moment due to increased focus on emerging markets. These markets have the ability to substantially increase the revenue of these giants.
Ishtiaq Ahmed has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Ishtiaq is a member of The Motley Fool Blog Network — entries represent the personal opinion of the blogger and are not formally edited.
The article 3 Healthcare Stocks for Growth and Dividends originally appeared on Fool.com is written by Ishtiaq Ahmed.
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