VTRS - Is Viatris a Great Dividend Stock or Just a Value Trap?
2024-03-14 09:53:00 ET
Viatris (NASDAQ: VTRS) is a large and diverse pharmaceutical business that spun off from Pfizer in 2020. The company's medications are in 165 countries and much of its business centers around generic drugs. But while its operations are diverse, this isn't the type of enterprise that screams growth. Chances are, if you're considering Viatris for your portfolio, it's because of its dividend and low valuation.
With a 3.9% yield, the healthcare stock offers investors a higher payout than the S&P 500 average of 1.4%. It's also trading at just 4 times its estimated future earnings (based on analyst projections). Those are a couple of big incentives to own the stock. But with its earnings declining significantly last year, is this really a great dividend stock to own, or just a value trap?
Viatris' latest earnings numbers should have investors a little concerned. Although revenue declined by 5% in 2023, the company also divested of some businesses in order to focus on therapeutic areas that it believes are core parts of its future: ophthalmology, gastroenterology and dermatology.
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Is Viatris a Great Dividend Stock or Just a Value Trap?