Is Gilead Sciences' Dividend Safe?
Biotech giant Gilead Sciences (NASDAQ: GILD) has a lot going its way, including the company's juicy dividend yield of 4.7%. That compares very favorably to the average S&P 500 yield of 1.4%. But there is more to a dividend company than the yield it offers. Arguably the most crucial factor for income-seeking investors to consider is the strength of a company's business.
There are other things to examine, including key financial ratios such as the cash payout ratio, which tells us what portion of a company's cash flow is going to its dividends. With this backdrop in mind, let's consider whether Gilead Sciences' dividend is safe.
Gilead Sciences has been highly successful in the market for COVID-19 therapies thanks to its antiviral Veklury. This medicine has been instrumental in helping the biotech's revenue and earnings stay afloat in the past couple of years. Elsewhere, Gilead Sciences remains a leader in the market for HIV therapies. These two businesses are currently the most important for Gilead Sciences.
Source Fool.com
