2 Healthcare Dividend Stocks That Are Screaming Buys in November

There is a lot of money flowing through the U.S. healthcare industry. According to the Centers for Medicare & Medicaid Services, America’s total health expenditures were $4.1 trillion in 2022, and that number has likely increased since then. People have always, and will always, need care, so healthcare is a great place to look for dividend stocks.

Pharmaceuticals and insurance are among the most lucrative pockets within America’s healthcare system, so start there. I found two blue chip stocks trading at bargain prices, with impactful dividends poised to grow over the coming years. Consider them when you’re putting new capital to work for your portfolio this month.

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Pfizer (NYSE: PFE) is a household name in the pharmaceutical industry, dating back to the mid-1800s. The company’s COVID-19 vaccine (Comirnaty) and treatment (Paxlovid) caused surging growth that lasted for a couple of years, but has largely dried up since then. The market has frowned on Pfizer’s declining top and bottom lines, pushing its share price to below where it was before the pandemic.

Yet, the stock is compelling for two reasons. First, its dividend yield is abnormally high at 6%, its highest level aside from the financial crisis in 2008-2009. High yields can signal trouble within a company, but Pfizer is financially sound. The company just raised its 2024 earnings guidance by $0.30 to between $2.75 and $2.95.

The annual dividend is $1.68 per share, which is only 61% of the low end of that guidance. Additionally, management has made it a point to emphasize Pfizer’s commitment to paying and increasing its dividend as recently as its Q3 earnings call.

PFE Dividend Yield Chart
PFE Dividend Yield Chart

Second, the company has repositioned its pipeline around oncology, using its pandemic profits to fund a $43 billion acquisition of Seagen. Pfizer anticipates that oncology will drive the company’s growth through 2030.

As such, analysts estimate Pfizer will reignite growth, calling for earnings growth averaging 10.6% over the next three to five years. That’s a compelling PEG ratio of 0.9 at the stock’s current price-to-earnings ratio (P/E) of 9.8, making Pfizer a high-yield bargain with additional share price upside.

UnitedHealth Group (NYSE: UNH) is one of the world’s largest companies (regardless of industry), with an annual revenue approaching $400 billion.


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