Saturday, March 29, 2014
Transition to Safer Stocks: Will Big Pharmaceuticals Make You Financially Healthy
Two years ago, I suggested big pharmaceutical stocks as a contrarian play as big pharma stocks were down almost 2% during the first few months of 2012, whereas the S & P 500 was up about 9% during that same time frame. The suggestions included Johnson & Johnson (JNJ), which has risen by almost 50% in the last couple years, and Merck (MRK), which has gone up by about 44%, both far outperforming the S & P 500, which went up around 31%.
These pharmaceutical stocks are still worth a second look, especially for long term investors. According to the free list of high yield big pharmaceutical stocks at WallStreetNewsNetwork.com, there over a dozen pharmaceutical stocks and more than half with yields of 3.0% or more.
Merck (MRK), is one of the largest pharmaceutical companies in the world. This is the company that makes such products as Gardasil, Singular, Levitra, Nasonex, Claritin, Clarinex, Coppertone, MiraLax, and Bain de Soleil. The stock trades at 38 times trailing earnings and 15 times forward earnings. The stock pays a healthy yield of 3.2%.
Johnson & Johnson (JNJ), founded in 1886, is considered to be the world's largest pharma company. It is a manufacturer of pharmaceutical, medical devices and consumer packaged goods. Products include Band-Aids, Acuvue, Listerine, OneTouch Blood Glucose Meter, Splenda, and Tylenol. The stock has a trailing price to earnings ratio of 20 and a forward PE ratio of 16, with a generous yield of 2.8%.
If you want a list of over a dozen high yield pharma stocks, that can be downloaded and sorted, go to WallStreetNewsNetwork.com.
Disclosure: Author owns T.