Healthy Income from Pharmaceutical Stocks

Using the Morningstar QuickRank tool we reveal the pharma stocks paying the highest dividend yield - and how our analysts value the companies' shares

Emma Wall 14 November, 2013 | 12:32AM
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Income seekers are spoilt for choice in the UK stock market - companies across the board, from miners to retailers, are paying out inflation beating yields, giving squeezed investors a viable return on cash. 

This week we are focusing on pharmaceuticals and examining just how much healthcare pays. Using the Morningstar Equity QuickRank, readers can choose their favourite sector and rank the companies by dividend yield.

We reveal the top five yielding pharmaceutical companies and whether Morningstar research implies each is fairly, under- or over-valued. Where there is a Morningstar valuation and star rating, this is given (5 stars = undervalued; 1 star = overvalued). For smaller stocks, the valuation is based on Morningstar's soon-to-be-launched Quantitative Research, which will cover all listed UK stocks, right down to the AIM market. 

1. AstraZeneca (AZN)

Yield: 5.47%
Morningstar analyst rating: 3 STARS
Morningstar fair value estimate: 3,500p

2. GlaxoSmithKline (GSK)

Yield: 4.79%
Morningstar analyst rating: 3 STARS
Morningstar fair value estimate: 1,777p

3. Animalcare Group (ANCR)

Yield: 2.98%
Morningstar quantitative rating: FAIRLY VALUED

4: CareTech Holdings (CTH)

Yield: 2.68%
Morningstar quantitative rating: FAIRLY VALUED

5. Alliance Pharma (APH)

Yield: 2.37%
Morningstar quantitative rating: FAIRLY VALUED

The information contained within is for educational and informational purposes ONLY. It is not intended nor should it be considered an invitation or inducement to buy or sell a security or securities noted within nor should it be viewed as a communication intended to persuade or incite you to buy or sell security or securities noted within. Any commentary provided is the opinion of the author and should not be considered a personalised recommendation. The information contained within should not be a person's sole basis for making an investment decision. Please contact your financial professional before making an investment decision.

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Securities Mentioned in Article

Security NamePriceChange (%)Morningstar
Rating
Alliance Pharma PLC45.30 GBX1.23
Animalcare Group PLC238.00 GBX1.71
AstraZeneca PLC11,022.00 GBX-0.18Rating
GSK PLC1,419.50 GBX1.94Rating

About Author

Emma Wall  is former Senior International Editor for Morningstar

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