Investors turn to pharma for yields

Everyone is looking for a safer place to put their money these days, and that means analysts and stock-pickers are paying closer attention to Big Pharma. Traditionally, drug stocks are seen as a "recession-proof" play, and though we've recently covered news of cash-strapped patients cutting back on their medications, those folks aren't likely to scrimp as much at the pharmacy as they will at Macy's and Target and Lowe's.

Plus, as Seeking Alpha points out today, drug stocks also pay dividends. Here's a list of that site's top 10 pharma picks, each with P/E's below 20 and a price-to-earnings-to-growth (PEG) of less than three.

  • Pfizer is famous for its dividend. It's the highest-yielding stock on this list, at 7.5 percent with a P/E of 12.7 and PEG of 2.12.
  • Bristol-Myers Squibb yields 7.2 percent, with a P/E of 16.3 and PEG of 1.54.
  • GlaxoSmithKline boasts a yield of 5.5 percent, with a P/E of 11.9 and PEG of 1.99.
  • Eli Lilly also yields 5.5 percent, and its P/E is a low 9.9; PEG stands at 1.39.
  • Merck stock now yields 5.4 percent; its P/E is 12.4 and PEG is 2.48.
  • Bayer's yield is a big dropoff from Merck's at 3.8 percent; its P/E is 13.2 and PEG is 1.26.
  • Wyeth yields 3.5 percent, with a low low P/E of 9.6 and PEG of 2.48.
  • Roche yields 3.3 percent, and its P/E is 14.6. PEG is 1.91.
  • Novartis yields almost as much, at 3.2 percent, and its P/E is 16. PEG is 2.34.
  • Johnson & Johnson's yield stands at 2.9 percent, with a P/E of 14.4 and PEG of 1.65.

- read the story at Seeking Alpha

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