3 Healthcare Stocks With Fresh Dividend Hikes and Different Income Profiles

Key Points

• Healthcare remains a useful sector for income investors because demand tends to hold up across economic cycles.
• Recent dividend increases show that select healthcare companies are still confident enough in their cash flow to raise payouts.
• McKesson, Encompass Health and Omega Healthcare give investors three different ways to approach healthcare income.

The healthcare sector just saw a wave of dividend increases. These latest income boosts extend to $100 billion industry leaders and a large-cap healthcare real estate investment trust (REIT), which are posting impressive returns year after year.

Notably, two names have extremely strong dividend sustainability, while one high-yield stock has solid sustainability after industry-specific adjustments.

Healthcare Behemoth McKesson Continues Impressive Dividend Growth

First up is a true giant in the healthcare sector, McKesson NYSE: MCK. The company is one of the world’s largest pharmaceutical distributors, ensuring that branded and generic drugs move from producers to pharmacies and hospitals. With a market capitalization of more than $100 billion, McKesson is one of the U.S.’s top 20 most valuable healthcare stocks.

McKesson put up a very strong performance in 2025, delivering a total return of 44.5%, and is up nearly 10% in 2026. This comes as McKesson posted strong adjusted earnings per share (EPS) growth of 18% year over year (YOY) in its fiscal year 2026. (Note that the company’s fiscal reporting period is two quarters ahead of the calendar period.) The firm expects another year of solid growth in fiscal year 2027 of between 12% and 14%. GLP-1s have been an important growth driver for the company, with GLP-1 revenues rising 27% in fiscal 2026 to $53 billion.

McKesson recently announced a significant 14.6% increase to its dividend, with its quarterly payment moving to 94 cents per share. The company expects to pay its next dividend on Oct. 1 to shareholders on record as of the Sept. 1 close. Overall, McKesson’s forward dividend yield remains relatively low at around 0.4%. However, the company has grown its dividend very quickly, at a 13.68% five-year annual rate, and its payout ratio is rock-solid at 8.5%.

Encompass Boosts Dividend Over 10%

Encompass Health NYSE: EHC is a smaller healthcare name, but still a sizable player with a market capitalization near $11 billion. Encompass shares have delivered a return near 8% in 2026 and have seen a strong rebound in Q3, up more than 10%. The company primarily operates inpatient rehab sites, serving patients who are recovering from serious injuries and illnesses. Notably, Encompass has grown its revenue by more than 10% for three years in a row, and recently raised its 2026 full-year revenue and adjusted EPS guidance.

Encompass also announced a substantial increase to its quarterly dividend, moving the figure up by 10.5% to 21 cents per share. This gives Encompass a forward dividend yield of approximately 0.74%. The payable date for Encompass’s next dividend is Oct. 15 to shareholders on record as of Oct. 1.

Notably, Encompass cut its dividend significantly in 2022 to 15 cents due to the spin-out of its home health and hospice business. However, since then, its dividend has increased by 40%. Meanwhile, the company’s payout ratio is very low at only 12.69%, making the firm’s dividend sustainable and providing significant room for further increases.

Omega Healthcare: Putting Up Big Returns With an Over 5% Yield

Last up is Omega Healthcare Investors, which has a market capitalization of nearly $15 billion. This makes Omega one of the top five most valuable healthcare REITs in the United States. The company primarily invests in skilled nursing and assisted living facilities. Generally speaking, investments in this space have fared very well over the past several years. Omega generated a total return of 33.5% in 2024, 25.5% in 2025, and has returned nearly 20% in 2026. The huge tailwind driving this industry is the aging population of the United States, which is creating more demand for the facilities that Omega and others invest in.

Omega recently issued a slight dividend increase of 1.5%, moving its quarterly payout to 68 cents. However, the stock has a very high dividend yield, which now sits at 5.3% going forward. One negative is that the company’s current payout ratio is 129.47%, meaning that its dividend payments significantly exceed its earnings. However, rather than EPS, funds available for distribution (FAD) are a better metric for assessing the dividend sustainability of REITs due to unique accounting considerations.

In its latest quarter, Omega’s FAD was 78 cents per share. This equates to a FAD-based payout ratio of just 87.1%. As REITs pay out much greater dividends than other industries, this payout ratio is within a reasonable level.

The Bigger Dividend Story Is Sustainability

McKesson’s GLP-1 growth trajectory remains worth watching because it has been a meaningful driver of the company’s recent results. But for income investors, the broader takeaway is that McKesson, Encompass Health and Omega Healthcare each bring a different kind of dividend appeal.

McKesson offers rapid dividend growth from a low payout base, Encompass Health has a smaller but well-covered dividend supported by operating momentum, and Omega Healthcare provides the highest yield, provided investors judge it by REIT cash-flow metrics rather than GAAP earnings alone. Together, they show that select healthcare dividend stocks still have the cash-flow support to keep rewarding shareholders.