In today's low-interest-rate environment, investors have flocked to dividend-paying stocks, which raises the question of where to go for nice yields in health care. Usually big pharma stocks are the best bet, but to find out for sure, Fool.com analyst Brenton Flynn conducted a screening in search of health-care companies yielding more than 3.5%. The results produced a grand total of 11 stocks -- out of the entire industry -- and pickings become even slimmer upon examination of these "winning" companies.
For instance, PDL BioPharma (NASDAQ:PDLI)takes top place with its 7.8% yield, but considering that it loses patent protection in 2013 and 2014 and will continue to generate royalties only through 2016, this highest-yielding stock is one to run from -- not toward.
Watch the following video for Brenton's rundown on the rest of health care's top dividend-payers. There are several more to avoid, but also one small company that might just be the industry's unexpected best go-to for yield.
While you can certainly make huge gains in biotech and pharmaceuticals, the best investing approach is to choose great companies and stick with them for the long term. In our free report "3 Stocks That Will Help You Retire Rich," we name stocks that could help you build long-term wealth and retire well, and also reveal some winning wealth-building strategies that every investor should be aware of. Click here now to keep reading.