During volatile periods in the equity markets, dividend-paying stocks often attract investor attention due to their potential for stable income streams supported by reliable free cash flow. In the health care sector, several firms stand out for their high dividend yields, combining income potential with the defensive qualities inherent to the industry. This report examines the perspectives of Wall Street analysts, noted for their forecasting accuracy, on three prominent health care companies delivering attractive dividends: Merck & Co Inc (NYSE: MRK), CVS Health Corp (NYSE: CVS), and GSK plc (NYSE: GSK).
Merck & Co Inc (MRK)
Merck currently offers a dividend yield of 3.06%, positioning it as a compelling choice for income-focused investors. UBS analyst Trung Huynh, with a high accuracy record of 76%, recently reaffirmed a Buy rating on Merck’s shares. Huynh also significantly raised the price target from $105 to $130, reflecting a bullish outlook through early 2026. Meanwhile, Citigroup’s Geoff Meacham, whose predictions have a 71% accuracy rate, maintained a Neutral stance but also increased the price target from $95 to $110 for the same period.
On the corporate development front, Merck is currently reported to be engaged in acquisition discussions with Revolution Medicines Inc (NASDAQ: RVMD), a cancer drug developer. The proposed deal is rumored to be valued between $28 billion and $32 billion. Such a move may have material implications for Merck’s product portfolio and long-term growth prospects, as it aligns with the company’s ongoing focus on oncology.
CVS Health Corp (CVS)
CVS Health offers investors a dividend yield of 3.27%, making it one of the higher-yielding stocks within the health care sector. Analysts with strong track records have displayed confidence in the stock’s potential. Truist Securities analyst David Macdonald, whose accuracy stands at 69%, maintained a Buy rating and increased the price target slightly from $95 to $98, anticipating positive momentum through the end of 2026. Similarly, UBS analyst Kevin Caliendo, also rated at 69% accuracy, reiterated his Buy rating and nudged up the price target from $96 to $97, signaling steady confidence in CVS’s outlook.
From a news perspective, CVS Health has scheduled a conference call for February 10, 2026, to release and discuss its financial results for the fourth quarter. Such events are closely watched by market participants as they provide critical insight into the company’s operational performance and strategic progression.
GSK plc (GSK)
GSK maintains the highest dividend yield among the three, at 3.47%, attracting investors seeking income within the health care domain. However, analyst opinions on GSK present a more varied picture. Barclays analyst James Gordon, holding a 66% accuracy rating, downgraded the stock from Equal-Weight to Underweight in early January 2026, reflecting a more cautious stance. Conversely, Jefferies analyst Michael Leuchten, with a 57% accuracy rate, upgraded the stock from Hold to Buy in late October 2025, suggesting optimism about the company’s price appreciation potential.
In recent developments, GSK entered into a clinical trial collaboration with Summit Therapeutics announced on January 12, focusing on evaluating ivonescimab in conjunction with GSK’s B7-H3 antibody drug conjugate. This partnership highlights GSK’s investment in innovative therapeutics and potential pipeline enhancements.
Investor Considerations and Market Context
These three companies represent noteworthy dividend-paying options within the health care sector, each underpinned by distinct strategic moves and analyst insights. Market participants should weigh the supportive analyst price targets and varying recommendations against the risks inherent to sector-specific developments, including acquisition outcomes and clinical trial progress.
The detailed analysis of analyst ratings based on their historical accuracy provides investors with an additional layer of insight to guide decision-making. While Merck and CVS see generally positive sentiment among leading analysts, GSK’s divergent views suggest closer scrutiny is warranted. Upcoming earnings reports and ongoing corporate activities will be critical to monitor as part of a comprehensive investment approach.