5 Cheapest Major Drug Manufacturers With A Yield Above 4 Percent

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Includes: ABT, AZN, BMY, GSK, JNJ, LLY, MRK, NVS, PFE, SNY
by: Dividend Screen

Stocks from the healthcare sector still have a growing customer base due to the ongoing aging population. The best yielding industry within the healthcare sector is definitely the major drug manufacturing industry (see also the table below). A big burden on stocks from the industry is the expected loss of patents, owned by many drug companies. Billions of sales will be transferred from the established drug manufacturers to drug generic producers. If that were not bad enough, the market volume will significantly decline due to big price reductions. But this process does not seem as bad as expected. The big pharmacy companies still have an attractive product pipeline and they get diversified by investing money into other healthcare related businesses. That's reason enough to look at some companies from the drug industry.

I screened the major drug manufacturing industry by stocks with a dividend yield of at least 4 percent as well as a forward price to earnings ratio of less than 10. Here are the results:

1. AstraZeneca (NYSE:AZN) has a market capitalization of $62.9 billion, generates revenues in an amount of $33.6 billion and a net income of $10.1 billion. It follows P/E ratio is 6.6 and forward price to earnings ratio 7.8, Price/Sales 1.9 and Price/Book ratio 2.7. Dividend Yield: 5.7 percent.

2. Sanofi-Aventis (NYSE:SNY) has a market capitalization of $92.1 billion, generates revenues in an amount of $47.4 billion and a net income of $6.5 billion. It follows P/E ratio is 14.0 and forward price to earnings ratio 8.4, Price/Sales 1.9 and Price/Book ratio 1.2. Dividend Yield: 5.3 percent.

3. Merck & Co. (NYSE:MRK) has a market capitalization of $104.8 billion, generates revenues in an amount of $47.9 billion and a net income of $4.5 billion. It follows P/E ratio is 23.3 and forward price to earnings ratio 8.8, Price/Sales 2.2 and Price/Book ratio 1.9. Dividend Yield: 4.5 percent.

4. Novartis (NYSE:NVS) has a market capitalization of $128.5 billion, generates revenues in an amount of $58.8 billion and a net income of $10.1 billion. It follows P/E ratio is 13.2 and forward price to earnings ratio 9.7, Price/Sales 2.2 and Price/Book ratio 2.1. Dividend Yield: 4.2 percent.

5. Pfizer (NYSE:PFE) has a market capitalization of $153.4 billion, generates revenues in an amount of $68.2 billion and a net income of $10.1 billion. It follows P/E ratio is 15.5 and forward price to earnings ratio 8.5, Price/Sales 2.3 and Price/Book ratio 1.7. Dividend Yield: 4.1 percent.

Here is a short overview of the best yielding stocks with some fundamentals ():

10 Best Dividend Paying Drug Stocks (Click to enlarge)



Disclosure: I am long JNJ.