17 Best Healthcare Dividend Growth Picks Of The Past 20 Years

The healthcare sector should be an important part of every dividend investor's portfolio. Healthcare spending as a portion of GDP in OECD countries is expected to rise steadily over the coming decades. In East Asia, healthcare spending will also rise relative to GDP, given the steep drop in fertility in that region over the last 20 years.

An aging population is a very long-lived, secular trend, and so many well-positioned healthcare businesses have steady growth prospects as far out as the eye can see. Luckily for income investors, the healthcare sector includes many businesses that are stable, dividend-minded and have good balance sheets.

Today, I like to introduce a few of the best dividend growth stocks from the healthcare sector. You might have some great names in your mind, like Johnson & Johnson or Medtronic.

For me, the medical equipment industry is a great way to invest into the future. Pharmacy is also a great but they are more cyclic and threaten by biotech. Those get also pressure from bio-similars.

There is no guarantee for a good return in the future but I feel confident to own some of the best names in the sector.

These are the best Healthcare dividend growth picks of the past 20 years. Which stocks do you like?

20 Healthcare Dividend Stocks Each Investor Must Love

Buying and holding dividend-paying stocks has proven to be a terrific strategy for long-term investors. Companies with the ability to raise their dividends over time can become reliable sources of income for shareholders.

The healthcare industry can be a great place to find dividend-paying companies since healthcare spending tends to be recession-resistant. This allows companies with strong competitive positions to continue to pay out strong dividends, even if the economy takes a turn for the worse.

I've compiled some of the 20 most attractive dividend stocks from the sector in one sheet.

Here are the 5 best picks from the sector by yield...more in the attached sheet....

Cracking The Best Healthcare Dividend Stock Secret

This Weekend my eyes and thoughts curved around the Healthcare sector. 

I read several interesting articles from the sector, mostly about the biotech’s and new Hepatitis C drugs from Gilead, Sovaldi and Harvoni.

Those are very expensive drugs with potential to kill the current medical systems but they also generate tons of cash for their corporate.

I also noticed that the Healthcare sector grows at a much faster pace than the economy does, with 10+ percent. How can you benefit from this trend? I don't know. Prices are high, even on free cash flow basis.

Second, the old synthetic drug cash cow system from Pfizer doesn't work anymore. PFE is losing revenues. Even Teva, a generic drug manufacturer, struggles.

In order to get an overview about modest valuated growth stocks from the Healthcare sector, I've created a screen for large capitalized sector members with the following main criteria:

- EPS growth next five years: over 5 percent

- Sales growth past five years: over 5 percent

- Forward P/E under 20

- Positive Dividend

14 attractive healthcare growth stocks remain. It's a very selective list with focus on sales and earnings growth. You can find the full results attached. 

You may also interested in my older articles about healthcare dividend stocks.

Below are also five of my favorites. Which stocks do you like? Please let me know.

5 Cash-Hoarding Stocks With Top Yields And Strong Cash Flows (PFE, COP, CVX, LLY, MRK)

While I made my daily research on several stock market screeners, one question came deeply into my mind. When the markets are so expensive, who are the cheapest stocks, not by P/E but in terms of cash flow or Ebitda. I also included the Cash and debt of the company.

So, the good thing is that you can buy stocks in every market cycle but you must be careful with your investment spending.

Your final return depends in the end on your inital investment cost and if you buy at a high price, your return will fall into a low or negative area.

Good to know that dividends can upper your yield but my experience is that it could be very painful for an investor to look at a suffering return over years.

These are my criteria:

- Market Cap over 15 Billion

- Dividend Yield in the higher yield space over 3 percent

- Cheapest Enterprise-To-Ebitda Ratio on the market

My screen delivered some interesting results in the large cap area: Oil companies are top. 

COP, CVX are the best results in terms of EV/EBITDA. Both have a ratio of around 5 which is very comfortable in the current situation but what about Russia and the Middle East crises?

My second best results came from the technology space: Intel and Verizon. Warren Buffett added his VZ stake by one third on the past quarter and he might be right because VZ is much cheaper than rival AT&T. The EV/EBITDA ratio is only at 6.35 while T has a ratio of 9.66.

Healthcare is also good positioned with Merck, Pfizer and Eli Lilly but those are suffering on the patent cliff.

I believe that it does not make sense to look at stocks with a higher ratio. For sure cash flows can come down and the full sheet becomes trash but most of the companies serve values. What are your thoughts about my current screen? How are you invested?

These are the best results in terms of lowest debt-to-equity ratio:

Merger And Takeover Rumors In The Drug Industry - These Are The Best Dividend Yields To Catch!

Pharmacy stocks come into the focus of investors. Novartis, a Swiss drug producer, announced a few big deals with GlaxoSmithKline and Eli Lilly. Valeant Pharmaceuticals International wants to buy rival Allergan for USD 48 billion and Pfizer talked with AstraZeneca about a $100 billion takeover transaction.

The whole industry is still under pressure due to the patent cliff but there are also big opportunities due to an aging population. The risks are cost pressure by the government. Politicians want a cheap care for the population. However, below is an overview of the largest drug makers and their dividend payments. I've only published those stocks with a market cap above USD 100 billion. What do you think - who has the best position to create big shareholder values?

The biggest pharma stocks are...

3 Top Stocks That Warren Buffett Bought During The Recent Quarter

Warren Buffett is one of the most trusted investors on the market. When he moves his big money, the whole street is watching and tries to figure out what he is thinking about.

The latest big move was reasonable to Exxon Mobil, the largest U.S. oil producer. Warren bought ConocoPhillips on the peak of the oil price and was wrong with his investment decision. Now it looks that he gives his oil bet a second chance with the strongest cash flow producer in this field.

At the same time Warren Buffett reduced its current position in ConocoPhillips but keeps the downstream business Philips 66 stable. I have no idea what he is thinking about with this transaction. 

In addition, Warren increased shares of DaVita Healthcare Partners and Goldman Sachs. Here you can find a detailed overview about the latest big stock purchases from Warren Buffett.

Warren Buffett's latest stock purchases (click to enlarge)
Source: Gurufocus.com

Exxon Mobil (NYSE:XOM) has a market capitalization of $415.45 billion. The company employs 76,900 people, generates revenue of $453.123 billion and has a net income of $47.681 billion. Exxon Mobil’s earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $65.769 billion. The EBITDA margin is 14.51 percent (the operating margin is 11.01 percent and the net profit margin 10.52 percent).

Financial Analysis: The total debt represents 3.47 percent of Exxon Mobil’s assets and the total debt in relation to the equity amounts to 6.98 percent. Due to the financial situation, a return on equity of 28.03 percent was realized by Exxon Mobil. Twelve trailing months earnings per share reached a value of $7.65. Last fiscal year, Exxon Mobil paid $2.18 in the form of dividends to shareholders.

Market Valuation: Here are the price ratios of the company: The P/E ratio is 12.43, the P/S ratio is 0.92 and the P/B ratio is finally 2.58. The dividend yield amounts to 2.65 percent and the beta ratio has a value of 0.69.

Long-Term Stock Price Chart Of Exxon Mobil (XOM)

Long-Term Dividend Payment History of Exxon Mobil (XOM)

Long-Term Dividend Yield History of Exxon Mobil (XOM)

Goldman Sachs (NYSE:GS) has a market capitalization of $76.86 billion. The company employs 31,700 people, generates revenue of $41.664 billion and has a net income of $7.475 billion. Goldman Sachs’s earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $12.462 billion. The EBITDA margin is 29.91 percent (the operating margin is 26.90 percent and the net profit margin 17.94 percent).

Financial Analysis: The total debt represents 47.24 percent of Goldman Sachs’s assets and the total debt in relation to the equity amounts to 585.58 percent. Due to the financial situation, a return on equity of 10.66 percent was realized by Goldman Sachs. Twelve trailing months earnings per share reached a value of $16.47. Last fiscal year, Goldman Sachs paid $1.77 in the form of dividends to shareholders.

Market Valuation: Here are the price ratios of the company: The P/E ratio is 10.29, the P/S ratio is 1.84 and the P/B ratio is finally 1.13. The dividend yield amounts to 1.30 percent and the beta ratio has a value of 1.30.

Long-Term Stock Price Chart Of Goldman Sachs (GS)

Long-Term Dividend Payment History of Goldman Sachs (GS)

Long-Term Dividend Yield History of Goldman Sachs (GS)

DaVita HealthCare Partners (NYSE:DVA) has a market capitalization of $13.09 billion. The company employs 53,400 people, generates revenue of $8.186 billion and has a net income of $641.46 million. DaVita HealthCare Partners’s earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $1,710.45 million. The EBITDA margin is 20.89 percent (the operating margin is 15.84 percent and the net profit margin 7.84 percent).

Financial Analysis: The total debt represents 53.45 percent of DaVita HealthCare Partners’s assets and the total debt in relation to the equity amounts to 227.32 percent. Due to the financial situation, a return on equity of 18.16 percent was realized by DaVita HealthCare Partners. Twelve trailing months earnings per share reached a value of $2.66. Last fiscal year, DaVita HealthCare Partners paid no dividends to shareholders.

Market Valuation: Here are the price ratios of the company: The P/E ratio is 23.18, the P/S ratio is 1.60 and the P/B ratio is finally 3.45. The beta ratio has a value of 0.49.

Long-Term Stock Price Chart Of DaVita HealthCare Partners (DVA)

Long-Term Dividend Payment History of DaVita HealthCare Partners (DVA)

Long-Term Dividend Yield History of DaVita HealthCare Partners (DVA)

Warren Buffett's Latest Stock Portfolio

Warren Buffett's latest stock purchases (click to enlarge)
Source: Streetinsider.com

Warren Buffett's latest stock purchases (click to enlarge)
Source: Gurufocus.com

12 Healthcare Dividend Stocks With High Potential To Boost Growth And Hike Dividends

Healthcare dividend stocks with low payout ratios and small debt figures originally published at long-term-investments.blogspot.com. I love the combination of low debt with little payout ratios. 

The debt situation is one of the most important issues in corporate finance. It also expresses the ability to grow sales and earnings by enlarging the balance sheet with bank loans.

Only a low leveraged corporate has potential to boost sales without taking new investors into the boat that dilute the current earnings per share.

Today I would like to start an article serial about low leveraged stocks from several sectors with currently small dividend payouts. I believe it’s good to see what companies have the biggest potential to give shareholders huge amounts of money back in the near future and believe me, the tech sector is not the only place to be.

My criteria are a low dividend payout ratio of less than 20 percent as well as a debt-to-equity ratio under 0.5. Only twelve stocks fulfilled these very tight defined criteria.

One result is a High-Yield and nine stocks are recommended to buy or better. Most of the results come from the medical appliances & supplies or equipment industry.

Baxter: A New Medical Stock For The Dividend Yield Passive Income Portfolio

My recent stock buy from last Friday was the medical instruments and supplies company Baxter International. The stock lost over 7 percent within the recent week due to analyst rating updates. There should be a higher degree of competition.

The expected P/E is now at 12.83 and the stock yields at 2.95 percent – A good value for the industry in my view.

I purchased 20 stocks for my Dividend Yield Passive Income Portfolio with resulted in total investment costs of $1,332. The new stake will contribute around $37 yearly to the full portfolio income.

Latest Portfolio Transactions (Click to enlarge)

Portfolio Overview I (Click to enlarge)

Portfolio Overview II (Click to enlarge)

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For readers who are new to the matter and my dividend growth philosophy: I funded a virtual portfolio with 100k on October 04, 2012 with the aim to build a passive income stream that doubles each five to ten years. I plan to purchase each week one stock holding until the money is fully invested. The total number of constituents is expected at 50 – 70 companies and the dividend income should be at least at $3,000 per year.

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Over the full year, the expected dividend income amounts to $2,483.12. With around $28,600 in deposited cash, it’s still possible to reach the $3,000 by the end of this year.

Baxter is a Dividend Challenger with 7 consecutive dividend hikes. You can see the dividend and earings development of Baxter in the following chart.

Earnings and Dividends Of Baxter (Click to enlarge)

The full portfolio holdings are up 7.4 percent in average. Due to the high cash amount and slow buying process in a gaining market, the complete portfolio performance is only 6.43 percent, half of the return from the Dow Jones.

Portfolio Performance (Click to enlarge)

Here is the income perspective of the portfolio

Sym	Name	P/E Ratio	Dividend Yield	Buy	# Shrs	Income	Value
TRI	Thomson Reuters C	27.08	3.65	28.90	50	$64.75	$1,758.50
LMT	Lockheed Martin C	14.56	3.54	92.72	20	$92.00	$2,584.80
INTC	Intel Corporation	12.65	3.84	21.27	50	$45.00	$1,149.00
MCD	McDonald's Corpor	17.98	3.14	87.33	15	$46.20	$1,456.80
WU	Western Union Com	11.74	2.69	11.95	100	$50.00	$1,864.00
PM	Philip Morris Int	17.04	4.02	85.42	20	$70.58	$1,746.60
JNJ	Johnson & Johnson	19.33	2.92	69.19	20	$50.80	$1,734.60
MO	Altria Group Inc	16	5.14	33.48	40	$72.00	$1,388.40
SYY	Sysco Corporation	19.23	3.46	31.65	40	$44.40	$1,281.20
DRI	Darden Restaurant	16.5	4.41	46.66	30	$61.50	$1,401.00
CA	CA Inc.	13.22	3.31	21.86	50	$50.00	$1,503.00
PG	Procter & Gamble	20.22	2.98	68.72	25	$58.20	$1,930.25
KRFT	Kraft Foods Group	17.36	3.78	44.41	40	$80.00	$2,115.20
MAT	Mattel Inc.	18.92	3.3	36.45	40	$55.60	$1,683.60
PEP	Pepsico Inc. Com	18.97	2.74	70.88	20	$44.20	$1,604.00
KMB	Kimberly-Clark Co	20.3	3.32	86.82	15	$47.55	$1,421.85
COP	ConocoPhillips Co	11.71	3.8	61.06	20	$52.80	$1,406.20
GIS	General Mills In	18.18	2.82	42.13	30	$41.10	$1,442.40
UL	Unilever PLC Comm	18.98	3.33	39.65	35	$47.01	$1,388.10
NSRGY	NESTLE SA REG SHR	19.25	3.12	68.69	30	$65.31	$2,099.40
GE	General Electric	17.95	3.13	23.39	65	$49.40	$1,563.25
ADP	Automatic Data Pr	25.27	2.39	61.65	25	$43.50	$1,814.00
K	Kellogg Company C	22.93	2.97	61.52	25	$44.50	$1,475.50
KO	Coca-Cola Company	20.4	2.83	38.83	40	$43.80	$1,536.00
RTN	Raytheon Company	13.78	2.63	57.04	20	$42.00	$1,574.80
RCI	Rogers Communicat	11.79	3.84	46.5	50	$84.00	$2,167.50
GPC	Genuine Parts Com	18.18	2.61	77.06	20	$42.12	$1,607.80
TSCDY	TESCO PLC SPONS A	234.27	3.92	17.08	110	$75.68	$1,942.60
APD	Air Products and	23.28	2.54	85.71	15	$41.55	$1,605.00
GSK	GlaxoSmithKline P	19.38	4.66	52.16	30	$71.13	$1,514.40
WMT	Wal-Mart Stores	14.53	2.42	79.25	20	$36.16	$1,487.20
BTI	British American	16.34	3.91	111.13	23	$96.14	$2,450.65
CHL	China Mobile Limi	11.14	3.94	55.32	25	$55.95	$1,419.75
MMM	3M Company Common	18.89	2.07	110.27	15	$37.43	$1,803.30
TUP	Tupperware Brands	18.8	2.53	80.98	15	$33.30	$1,303.50
IBM	International Bus	13.51	1.89	197.09	16	$57.60	$2,990.72
HAS	Hasbro Inc.	19.28	3.19	44.09	30	$45.60	$1,421.40
T	AT&T Inc.	26.21	5.23	34.47	30	$53.70	$1,019.40
WAG	Walgreen Co. Comm	23.94	2.08	44.25	30	$34.20	$1,635.30
AFL	AFLAC Incorporate	8.68	2.24	59.39	20	$28.00	$1,244.20
TGT	Target Corporatio	15.27	2.38	68.69	32	$48.32	$2,046.08
CSCO	Cisco Systems In	12.78	2.61	25.12	90	$55.80	$2,099.70
DE	Deere & Company C	9.54	2.4	84.11	15	$29.85	$1,235.55
RGR	Sturm Ruger & Co	13.22	3.08	51.65	20	$38.52	$1,271.20
LO	Lorillard Inc Co	13.97	4.83	42.3	30	$65.00	$1,356.90
UNP	Union Pacific Cor	17.98	1.81	154.75	8	$22.88	$1,252.72
IDA	IDACORP Inc. Com	13.07	3.11	47.94	20	$30.40	$967.60
BAX	Baxter Internatio	16.55	2.83	66.38	20	$37.60	$1,327.60
						$2,483.12	$78,092.52
						Average Yield	3.18%
						Yield On Cost	3.42%