Best dividend large-cap healthcare stocks for Q1 2025

Large-cap healthcare companies with strong dividend policies are a cornerstone of a resilient investment portfolio. This article highlights top dividend-paying healthcare giants that combine industry leadership with shareholder value, offering both stability and income growth.

Cardinal Health stands out as a reliable distributor of pharmaceuticals and medical products, delivering consistent dividend payments and financial stability. The Cigna Group, a global health services leader, offers robust dividend yields supported by its diversified and growing revenue streams. Abbott Laboratories, renowned for its innovation in diagnostics and medical devices, pairs solid earnings with a strong commitment to rewarding shareholders.

For Q1 2025, these dividend-paying large-cap healthcare stocks provide a compelling case for investors seeking reliable income and long-term growth. Explore these opportunities to enhance your portfolio with steady returns from the healthcare sector.

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Before we dive into each company, let`s take a look at how your investment would have performed if you had invested in top 10 stocks mentioned in this article 5 years ago.

Now, let`s take a closer look at each of the companies:

  • Cardinal Health (CAH)

    Cardinal Health is a multinational healthcare services and products company that provides pharmaceuticals, medical supplies, and solutions to healthcare providers worldwide. The company was founded in 1971 in Dublin, Ohio, originally as Cardinal Foods before shifting its focus to pharmaceutical distribution. Over the years, it has grown into a critical player in the healthcare supply chain, ensuring the efficient delivery of essential medical products.

    Cardinal Health operates through two main segments: pharmaceutical distribution and medical products. Its pharmaceutical division supplies medications to hospitals, pharmacies, and healthcare facilities, while its medical segment provides surgical supplies, laboratory products, and patient care solutions. With a strong focus on logistics, Cardinal Health helps healthcare providers optimize supply chain efficiency, reduce costs, and improve patient care outcomes.

    Cardinal Health financial statements

    Analysts recommendation: 1.84

    Financial Health

    • Return on assets (ROA): 2.8%
    • Return on equity (ROE): N/A
    • Return on investment (ROI): 32.15%

    Profitability

    • Gross margin: 3.33%
    • Operating margin: 1.01%
    • Net profit margin: 0.59%

    Growth

    • EPS (past 5 years): -5.3%
    • EPS (current): 5.36
    • EPS estimate (next quarter): 2.17
    • EPS growth (this year): 5.65%
    • EPS growth (next year): 12.82%
    • EPS growth (next 5 years): 9.76%
    • EPS growth (quarter-over-quarter): 14.71%
    • Sales growth (past 5 years): 9.33%
    • Sales growth (quarter-over-quarter): -3.8%

    💡 Why invest in Cardinal Health?

    Cardinal Health offers several potential advantages for investors seeking exposure to the healthcare industry:

    • Essential Role: As a distributor of pharmaceuticals and medical products, Cardinal Health plays a critical role in the healthcare supply chain.
    • Diversified Revenue Streams: The company's three segments provide a diversified revenue base, reducing reliance on any single market.
    • Scale and Efficiency: Cardinal Health's size and scale enable it to leverage its distribution network and negotiate favorable terms with suppliers.
    • Growth Potential: The healthcare industry continues to grow, driven by factors such as an aging population and increasing demand for medical services.

    🐌 Key considerations before investing in Cardinal Health

    However, before investing in Cardinal Health, it's crucial to consider these potential challenges:

    • Regulatory Environment: The healthcare industry is heavily regulated, with changes in government policies impacting reimbursement rates and market dynamics.
    • Competition: The pharmaceutical distribution and medical products markets are competitive, with both established players and new entrants vying for market share.
    • Supply Chain Disruptions: Issues with product availability, transportation, or manufacturing can impact operations and profitability.
    • Economic Conditions: Economic downturns can affect healthcare spending and demand for medical products.

    Final thoughts on Cardinal Health

    Cardinal Health's role as a healthcare distribution leader, diversified revenue streams, and scale offer potential advantages for investors. However, the regulatory environment, competition, supply chain risks, and economic factors necessitate careful consideration. Thorough research on Cardinal Health's market share, financial performance, and the overall healthcare industry trends is crucial before investing.

  • Cigna (CI)

    The Cigna Group is a global health services company providing insurance, pharmacy benefits, and healthcare solutions to individuals and businesses. Founded in 1982 and headquartered in Bloomfield, Connecticut, the company has grown into one of the largest health insurers in the world, serving millions of customers across more than 30 countries. With a focus on improving health outcomes and affordability, Cigna offers a wide range of services, including medical, dental, disability, and life insurance products.

    The company operates through its core segments, including Cigna Healthcare and Evernorth, its health services division, which provides pharmacy benefit management, behavioral health, and care delivery solutions. Cigna is known for its emphasis on preventive care, value-based contracting, and digital health innovation to enhance patient experiences and reduce overall healthcare costs. By leveraging data-driven insights and a customer-first approach, The Cigna Group continues to play a vital role in shaping the future of healthcare, making high-quality care more accessible and efficient.

    Cigna financial statements

    Analysts recommendation: 1.67

    Financial Health

    • Return on assets (ROA): 2.29%
    • Return on equity (ROE): 7.87%
    • Return on investment (ROI): 4.91%

    Profitability

    • Gross margin: N/A
    • Operating margin: 2.85%
    • Net profit margin: 1.41%

    Growth

    • EPS (past 5 years): -2.04%
    • EPS (current): 12.24
    • EPS estimate (next quarter): 6.35
    • EPS growth (this year): 8.29%
    • EPS growth (next year): 11.59%
    • EPS growth (next 5 years): 10.54%
    • EPS growth (quarter-over-quarter): 46.75%
    • Sales growth (past 5 years): 9.98%
    • Sales growth (quarter-over-quarter): 28.66%

    💡 Why invest in Cigna?

    The Cigna Group's strong position in the healthcare industry offers several potential advantages for investors seeking exposure to this critical sector:

    • Essential service: Health insurance is a must-have, making Cigna's offerings crucial for individuals and businesses.
    • Diversified products: Cigna offers a wide range of health and dental plans, reducing reliance on any single market segment.
    • Innovation focus: Cigna invests in new technologies to improve healthcare access, affordability, and customer experience.
    • Global presence: Operating in over 65 countries allows Cigna to benefit from growth in emerging healthcare markets.

    🐌 Key considerations before investing in Cigna

    However, before investing in The Cigna Group, it's crucial to consider the potential challenges they face:

    • Competitive landscape: The healthcare insurance industry is crowded, with Cigna needing a competitive edge in cost, coverage, and digital experience.
    • Regulatory environment: Changes in government policies or healthcare laws can significantly impact Cigna's products, pricing, and profitability.
    • Rising healthcare costs: Cigna must manage costs effectively while offering comprehensive coverage to customers.
    • Economic downturns: During economic downturns, businesses and individuals might cut back on healthcare spending, impacting Cigna's revenue growth.

    Final thoughts on Cigna

    The Cigna Group's strong brand, experience, diversified products, and focus on innovation paint a promising picture for long-term investors seeking exposure to the essential healthcare sector. However, the competitive landscape, regulatory environment, rising healthcare costs, and economic sensitivity necessitate careful consideration. Thorough research on Cigna's innovation pipeline, their strategies for navigating these challenges, and a clear understanding of your risk tolerance are crucial before adding The Cigna Group to your portfolio. Remember, in today's world, navigating healthcare can be complex, and The Cigna Group strives to be a guiding force. Their story could be a healthy addition to your investment journey.

If you are interested in other stock categories, check out my other lists of the best dividend large-cap utility, basic materials, energy, industrial, retail, healthcare, financial, tech stocks.