Biotech giant Gilead Sciences (GILD 0.28%) 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.

What's going on with Gilead Sciences' business?

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.

Gilead Sciences' revenue jumped by 3% year over year in the first quarter to $6.6 billion. The company's adjusted earnings per share grew by 4% year over year to $2.12. Sales of Veklury grew by 5% year over year to $1.5 billion, while Gilead Sciences' HIV franchise recorded sales of $3.7 billion, about 2% higher than the year-ago period. The company is still dealing with the loss of exclusivity for some of its HIV products, including Truvada.

Sales of Truvada dropped by 72% year over year in the first quarter to $38 million. On the other hand, some of Gilead Sciences' important HIV products continue on their march forward. Biktarvy's sales jumped by a solid 18% year over year to $2.2 billion in the period.

Gilead Sciences hoped that new approvals would offset the losses it is incurring due to patent cliffs, but things haven't gone as planned for the biotech giant. In March, the U.S. Food and Drug Administration (FDA) declined to approve the company's lenacapavir. The agency cited compatibility issues with Gilead Sciences' proposed vial that would contain the lenacapavir solution. Gilead Sciences is confident it can work things out with the FDA.

Lenacapavir would be an important approval for the company as it would become "the first available six-month, long-acting subcutaneous injection for the treatment of HIV." Importantly, Gilead Sciences boasts a pipeline full of potential HIV therapies. In my view, there is a good chance that lenacapavir will earn approval eventually. Gilead Sciences will record other major regulatory milestones in this therapeutic area in the next five years.

How long will the company continue to benefit from its coronavirus-related work? Veklury has remained a crucial COVID-19 treatment even as newer and more contagious variants of the virus have taken over, and competing therapies have become popular. The pandemic is not over; even once it officially ends, COVID-19 could become endemic. Veklury might lose some steam if the outbreak comes to a close, but it likely won't stop contributing to Gilead Sciences' top line, at least not for another couple of years.

In the long run, I see Gilead Sciences' underlying business remaining solid as it delivers regulatory wins in HIV and other therapeutic areas. 

A top dividend stock

In addition to its juicy yield of 4.7%, Gilead Sciences' boasts a cash payout ratio of 36.5%. For reference, under 60% is generally considered "good." Gilead Sciences' payout ratio shows plenty of room for the company to continue growing its dividends, something it is accustomed to. The company has raised its payouts by 40.4% in the past five years. That's an average of more than an 8% increase per year.

Gilead Sciences isn't for investors looking for high-growth stocks -- but for income-seeking ones, it looks like an excellent target. And in addition, the company looks reasonably valued. Gilead Sciences' forward price-to-earnings ratio of 9.5 is lower than the biotech industry's average of 11.2. Dividend and value-oriented investors looking for a stable blue-chip company need not look elsewhere.