3 High-Yield Healthcare Stocks to Buy Now

Three high-yield healthcare stocks to consider in August are Merck (4.1% dividend yield), Ventas (2.8% dividend yield), and Omega Healthcare Investors (0.48% dividend yield). Merck is a pharmaceutical company with a long history of increasing its dividend annually for 15 consecutive years. Ventas is a real estate investment trust specializing in senior housing, which has come back strongly from the pandemic hit. Omega Healthcare Investors provides financing to the long-term care industry.

Investors seeking high-yield opportunities in the healthcare sector should consider Merck (NYSE: MRK), Ventas (NYSE: VTR), and Omega Healthcare Investors (NYSE: OHI). These stocks offer attractive dividend yields and promising growth prospects.

Merck, a pharmaceutical giant, boasts a dividend yield of 4.1%, more than twice the healthcare sector's average yield of 1.8% [1]. The company has increased its dividend annually for 15 consecutive years, demonstrating its commitment to rewarding shareholders. While Merck faces challenges due to the expiration of patents on its key drug, Keytruda, its strong R&D capabilities and scale position it to innovate and find new revenue streams. The current yield is near its highest levels since the Great Recession, making it an attractive option for income-focused investors.

Ventas, a real estate investment trust (REIT) specializing in senior housing, has a dividend yield of 2.8%. During the pandemic, Ventas cut its dividend, but it has since resumed dividend growth. The company's exposure to senior housing assets that it both owns and operates allows it to benefit from increased demand due to the aging population. Ventas' adjusted funds from operations (AFFO) rose 9% year over year in the second quarter, indicating strong growth prospects. As the senior housing market recovers, Ventas is well-positioned to benefit from increased demand and dividend growth.

Omega Healthcare Investors, another REIT in the senior housing sector, offers a dividend yield of 6.7%. The company has maintained its dividend through the pandemic, demonstrating its commitment to income investors. Omega's portfolio repositioning has been challenging, but the company's focus on growth and sustainability positions it well for the future. With AFFO rising around 8% in the second quarter, Omega's dividend is likely to remain sustainable as the company continues to grow.

Investors should carefully consider the risks associated with these stocks. Merck's reliance on a single drug, Keytruda, and the uncertainty surrounding its patent expiration pose potential risks. Ventas and Omega Healthcare Investors, while well-positioned for growth, face challenges related to tenant health and the senior housing market. Despite these risks, the attractive dividend yields and promising growth prospects make these stocks worth considering for income-focused investors.

References:
[1] https://www.aol.com/2-magnificent-stocks-buy-near-094000217.html
[2] https://finance.yahoo.com/news/3-high-yield-healthcare-stocks-084000992.html