One dividend stock picking up steam of late that investors should consider buying is Viatris (VTRS 0.75%). The healthcare company recently reported earnings that were incredibly positive. Shares have been on the rise -- up 13% in just the past month, right along with the S&P 500.

But there could be more gains to come for Viatris as the stock remains cheap. Let's see why.

Viatris reported strong numbers in Q2

Viatris is a global pharmaceutical company that makes and sells branded, generic, and biosimilar drugs. Its products span broad therapeutic areas, including oncology, immunology, diabetes, cardiovascular, and infections disease. Its top product, Lipitor, treats high cholesterol and generated $846 million of sales in the first half of this year.

Earlier this month, Viatris reported its second-quarter results for the period ended June 30. Net sales fell 10% year over year to $4.1 billion. However, when factoring out foreign exchange, the drugmaker's revenue was down just 3%. Branded products, its top segment, was off by just 1% operationally, while sales of generics declined by 11%.

Given that the economy is still on its way back to normal, those aren't bad numbers. And the company still anticipates that new product launches will generate $600 million in revenue this year (thus far, they have brought in $205 million).

More importantly, the company generated $718.6 million in free cash flow during the period, which was a 53% improvement from the prior-year period. And since the start of the year, free cash flow has totaled $1.8 billion versus less than $1.3 billion during the same period last year.

The company paid down debt

As a result of the strong cash flow that Viatris generated, the company was able to pay down $627 million worth of debt during the quarter -- and $1.5 billion so far this year. The company is well on track to hitting its goal of reducing debt by $2 billion for the full year. As of the end of the latest period, Viatris had non-current liabilities worth $23.6 billion, compared with $24.5 billion at the end of last year.

The declining debt load should help alleviate the company's interest costs, which totaled $145.9 million in Q2 (versus $167.1 million in the prior-year period). With an operating profit of $548.7 million, Viatris had good coverage over the interest payments this period. 

Its dividend looks safer than before

The stronger financials put Viatris' dividend in a much better light than before. Its diluted per-share profit of $0.26 is more than double its quarterly dividend payment of $0.12 per share. If Viatris can maintain this level of profitability, its payout ratio would be at less than 50%. And in terms of cash flow, Viatris spends about $145 million each quarter to pay the dividend.

From both a profit and cash perspective, there's plenty of buffer for Viatris to maintain its dividend. Its solid financials could even give the company the comfort to raise its dividend again; this year, it raised its payouts by one cent, up from the $0.11 per quarter it was paying its shareholders last year.

A great option for dividend investors

Even though Viatris has been rising of late, the healthcare stock still trades at an incredibly small multiple of three times its future profits. By comparison, the Health Care Select Sector SPDR Fund averages a multiple of 16. Viatris also trades at well below its book value, at a price-to-book multiple of less than 0.7.

For dividend investors, this could be an incredibly underrated stock to buy right now. With a yield of 4.3%, Viatris pays more than double the S&P 500 average of 1.5% and can help make the most of your money.