Health care is one of the best sectors to look for stocks with guaranteed and growing dividends, and demand for health care will not disappear even if the economy falls into recession.

Barron Weekly looks for health care stocks with the highest dividend yield in the S & P 500 and a higher return on free cash flow than the dividend yield.

Free cash flow refers to the operating cash flow left by a company after capital expenditure, which can be used to pay dividends, buy back shares, make acquisitions or repay debts.

If the yield on cash flow is higher than the dividend yield, the company has enough cash on hand to pay dividends.

Another filter is that dividends will be increased more in 2021 and 2020 than in the previous year, another sign of financial strength, as many companies cut dividends or suspend dividends in the early stages of the 2020 outbreak.

Six health care units stand out:$AbbVie (ABBV.US)$、$Gilead Sciences (GILD.US)$、$Cardinal Health (CAH.US)$、$Merck & Co (MRK.US)$、$Bristol-Myers Squibb (BMY.US)$和$Amgen (AMGN.US)$。

These six stocks are all large-cap stocks, their dividends are stable, and dividends are expected to grow further.

As of October 31, the six stocks had double-digit returns so far this year, including dividends.

Pharmaceutical company$AbbVie (ABBV.US)$The company, which has a dividend yield of 3.9%, announced late last month that it would raise its quarterly dividend to $1.48 a share from $1.41, an increase of about 5%. The company's dividend has risen 270% since it began paying a quarterly dividend of 40 cents in early 2013.

Aberdeen's revenue and profits come mainly from the best-selling drug Humira, which is used to treat rheumatoid arthritis. Humira's market dominance is likely to be weakened as new competitors emerge, but analysts surveyed by FactSet unanimously expect dividends to continue to grow at 4-6 per cent over the next few years because the company's other products can make up for the decline in Humira sales.

Biopharmaceutical company$Gilead Sciences (GILD.US)$The recent dividend yield also reached 3.9%. In the most recent quarter, the company paid out $928 million in dividends and spent $180 million on share buybacks, a sign of the strength of its free cash flow.

Gilead Sciences Inc raised his quarterly dividend to 73 cents from 71 cents in March and is expected to increase it again.

Gilead Sciences Inc's drugs are widely used in the fields of AIDS, liver disease, oncology and hematology.

Pharmaceutical giant$Merck & Co (MRK.US)$Nearly a year ago, it raised its quarterly dividend from 65 cents a share to 69 cents, an increase of about 6%. "We plan to provide shareholders with competitive returns through dividends, dividend increases and share buybacks," Caroline Litchfield, the company's chief financial officer, told analysts on last week's third-quarter earnings call. "

Merck's dividend yield is 2.8%, well above the 1.6% average of healthcare stocks in the s & p 500.

Merck is expected to earn $7.52 a share next year, up from $7.38 in 2022.

$Bristol-Myers Squibb (BMY.US)$The company, which has a dividend yield of 2.8%, announced at the end of last year that it had raised its quarterly dividend to 54 cents a share from 49 cents a share, and the big biopharmaceutical company has been steadily increasing its dividend.

Bristol-Myers Bristol-Myers Squibb Co's best-selling drugs include Eliquis (blood thinner), Opdivo (anticancer) and Revlimid (anticancer).

Damien Conover, an analyst at Morningstar Pharmaceuticals, said Bristol-Myers Bristol-Myers Squibb Co's free cash flow was "strong and stable" and dividends were guaranteed.

Prescription drug distributor$Cardinal Health (CAH.US)$The dividend yield is 2.6%. In May, the company announced a quarterly dividend of 49.57 cents a share, up slightly from 49.08 cents.

The company expects adjusted free cash flow for the current fiscal year to be between $1.5 billion and $2 billion, down from $2.3 billion last year, but enough to pay dividends.

Biotech company$Amgen (AMGN.US)$With a dividend yield of 2.9%, the company announced a quarterly dividend of $1.94 a share at the end of last year, up 10% from $1.76 a year earlier. The company is expected to continue to increase its dividend.

Amgen Inc has increased his dividend every year since he began paying dividends in 2011. The company's best-selling drugs include Neulasta, which prevents infection during chemotherapy, and Epogen, which treats anemia.

The company is expected to earn $17.52 a share this year, up from $17.10 last year and $18.70 per share in 2023, according to FactSet. As profits grow, dividends are expected to continue to grow.