The global pharmaceutical industry could generate about $1.2 trillion in sales in 2025, according to Statista, and projections call for 4.7% annual growth through 2029. The cancer treatment segment alone is expected to generate $208 billion in sales this year. With those growth projections even in an uncertain market, many investors might find this industry attractive.
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Not only are pharmaceutical stocks excellent defensive investments, some pharma stocks pay sizable dividends that can be a source of steady income and help offset the impact of inflation. Here are seven pharmaceutical stocks to buy with dividend yields of at least 2%, according to Argus:
| Stock | Upside Potential* | Forward Yield* |
| Johnson & Johnson (ticker: JNJ) | 17.4% | 3.1% |
| AbbVie Inc. (ABBV) | 27.1% | 3.7% |
| Novo Nordisk A/S (NVO) | 89.3% | 2.5% |
| AstraZeneca PLC (AZN) | 25.7% | 2.2% |
| Merck & Co. (MRK) | 41.0% | 4.1% |
| Amgen Inc. (AMGN) | 19.0% | 3.2% |
| Gilead Sciences Inc. (GILD) | 14.7% | 3.0% |
As of April 17 close.
Johnson & Johnson (JNJ)
Johnson & Johnson is a global leader in the pharmaceutical, medical device and consumer health care products industries. Its key products include anti-inflammation drug Stelara, multiple myeloma and light chain amyloidosis drug Darzalex and headache and oral blood cancer therapy Imbruvica. Analyst David Toung says Johnson & Johnson’s recent stock weakness was largely tied to a Texas judge rejecting the company’s proposal to have Red River Talc file for bankruptcy. Despite litigation uncertainty, Toung says Johnson & Johnson’s diversified growth strategy makes the weakness a buying opportunity for long-term investors. Argus has a “buy” rating and $185 price target for JNJ stock, which closed at $157.47 on April 17.
Dividend yield: 3.1%
AbbVie Inc. (ABBV)
AbbVie is a global biopharmaceutical company. Its key drugs include Humira for treating rheumatoid arthritis, psoriasis, Crohn’s disease and other conditions and Skyrizi for treating plaque psoriasis, psoriatic arthritis, Crohn’s disease and ulcerative colitis. Analyst Jasper Hellweg says immunology drugs Skyrizi and Rinvoq have helped AbbVie diversify its sales away from Humira, which now only represents about 11% of the company’s total revenue. By 2027, AbbVie management anticipates Skyrizi and Rinvoq will account for a combined $31 billion in revenue, including $20 billion from Skyrizi alone. Argus has a “buy” rating and $220 price target for ABBV stock, which closed at $172.99 on April 17.
Dividend yield: 3.7%
Novo Nordisk A/S (NVO)
Novo Nordisk is a Denmark-based leader in insulin management and diabetes care. The company produces a range of other pharmaceutical products as well. Novo Nordisk’s top drugs include type 2 diabetes and obesity drug Ozempic and type 2 diabetes drug Rybelsus. Hellweg says Novo Nordisk is working with regulators around the world to gain approval for new indications for its GLP-1 diabetes and obesity drugs, as well as other novel drug candidates. The company is in late-stage trials for new formulations of its blockbuster GLP-1 treatment semaglutide. Argus has a “buy” rating and $110 price target for NVO stock, which closed at $58.08 on April 17.
Dividend yield: 2.5%
[SEE: 9 Highest Dividend-Paying Stocks in the S&P 500]
AstraZeneca PLC (AZN)
AstraZeneca is one of the largest pure-play pharmaceutical companies in the world. Its leading commercial drugs include Tagrisso for lung cancer, Farxiga for type 2 diabetes and Soliris for paroxysmal nocturnal hemoglobinuria and atypical hemolytic uremic syndrome. Hellweg says AstraZeneca has recently gained approval for drugs treating breast cancer, lung cancer and lymphoma. The company’s CEO has said 2025 “marks the beginning of an unprecedented, catalyst-rich period.” AstraZeneca’s Ambition 2030 initiative aims to deliver $80 billion in revenue by the end of the decade. Argus has a “buy” rating and $85 price target for AZN stock, which closed at $67.59 on April 17.
Dividend yield: 2.2%
Merck & Co. (MRK)
Merck is one of the world’s largest pharmaceutical companies. Merck reported 7% revenue growth in the fourth quarter, including 18% sales growth from leading cancer drug Keytruda. Sales for Merck’s HPV vaccine Gardasil were down 3%. Hellweg says Merck has steadily gained regulatory approvals for new indications for its existing commercial drugs, including approval for Keytruda to treat non-small-cell lung cancer. High-growth cancer drug Welireg has gained additional approvals in Europe and China and is also being reviewed by the U.S. Food and Drug Administration for a new indication. Argus has a “buy” rating and $110 price target for MRK stock, which closed at $78 on April 17.
Dividend yield: 4.1%
Amgen Inc. (AMGN)
Amgen is one of the world’s largest biotechnology companies. Its leading commercial drugs include osteoporosis and hypercalcemia drug Prolia, autoimmune disease drug Enbrel and osteoporosis, hypercalcemia and bone cancer drug Xgeva. Hellweg says Amgen’s existing portfolio of commercial drugs is generating solid volume growth, and the company also has a strong pipeline of drug candidates in development. The FDA recently approved Amgen’s Lumakras in combination with Vectibix as a treatment for colorectal cancer. Amgen even has a GLP-1 weight-loss drug in development. Argus has a “buy” rating and $330 price target for AMGN stock, which closed at $277.29 on April 17.
Dividend yield: 3.2%
Gilead Sciences Inc. (GILD)
Gilead Sciences is a biopharmaceutical company that develops treatments for HIV/AIDS, hepatitis C, liver disease, hematology/oncology and inflammation. Its leading drugs include HIV drugs Biktarvy and Genvoya, and antiviral medication Veklury. Hellweg says Gilead is a market leader in both HIV and oncology. He says lenacapavir could potentially be a twice-yearly injectable pre-exposure prophylaxis (PrEP) for HIV. In addition, Hellweg is bullish on the recent European approval of primary biliary cholangitis (PBC) treatment seladelpar, and he anticipates substantial earnings growth in 2025. Argus has a “buy” rating and $120 price target for GILD stock, which closed at $104.54 on April 17.
Dividend yield: 3%
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7 Best Pharmaceutical Stocks to Buy for Income originally appeared on usnews.com
Update 04/21/25: This story was published at an earlier date and has been updated with new information.
