The U.S. healthcare sector is attractive for long-term investors, because the industry is set to benefit from a major growth tailwind—the aging population.

The U.S. is an aging country with a very large 65+ population. This means demand for healthcare is only set to grow going forward, likely at a rate above GDP growth.

Investors can capitalize on this trend by considering healthcare dividend growth stocks.

These 3 healthcare stocks have solid dividend yields and should raise their dividends each year, which could lead to outsized returns in the years ahead.

Elevance Health (ELV)

Elevance Health Inc., formerly known as Anthem, Inc., is a healthcare benefits company has more than 47 million members through its plans.

The company provides managed plans to a wide variety of markets, including individual, commercial, Medicare and Medicaid. Its two largest customer groups are government (~60% of annual sales) and commercial business (~30% of sales). Elevance has annual sales of $175 billion.

On January 22nd, 2025, Elevance raised its quarterly dividend 4.9% to $1.71, extending the company’s dividend growth streak to 15 consecutive years.

On April 22nd, 2025, Elevance reported first quarter results for the period ending March 31st, 2025. For the quarter, revenue grew 14.6% to $48.8 billion, which topped estimates by $2.55 billion. Adjusted earnings-per-share of $11.97 compared very favorably to adjusted earnings-per-share of $10.64 in the prior year and was $0.49 more than expected.

Revenue growth was primarily a result of higher premium yields in the Health Benefits, growth in Medicare Advantage and Individual ACA memberships, and increases in product revenue for CarelonRx. These gains were once again offset by a reduction in Medicaid membership.

Merck & Company (MRK)

Merck & Company is one of the largest healthcare companies in the world. Merck manufactures prescription medicines, vaccines, biologic therapies, and animal health products. Merck employs 71,000 people around the world and generates annual revenues of more than $65 billion. 

On April 24th, 2025, Merck reported first quarter results for the period ending March 31st, 2025. For the quarter, revenue declined 1.9% to $15.5 billion, but topped expectations by $170 million. Adjusted earnings-per-share was $2.22 compared to $2.07 the prior year and beat estimates by $0.08. Keytruda, which treats cancers such as melanoma that cannot be removed by surgery and non-small cell lung cancer, continues to be the key driver of growth for the company as sales for the drug were higher by 4% to $7.2 billion during the period. 

Sales for Merck’s HPV vaccine Gardasil declined 41% to $1.3 billion as demand in China has declined considerably. Excluding China, sales were up 14%. Animal Health grew 5% to $1.6 billion due to higher demand for Livestock and contributions from an acquisition. 

Merck provided updated guidance for 2025 as well, with the company still expecting sales in a range of $64.1 billion to $65.6 billion. Adjusted earnings-per-share are now projected to be in a range of $8.82 to $8.97 for the year.

Keytruda has shown very high rates of growth and has patent protection in the U.S. until 2028, in the European Union until 2030, and in Japan until 2032. Bolt-on acquisitions will help supplement Merck’s growth. For example, in 2024 Merck completed its $1.3 billion purchase of EyeBio, which has a pipeline of drug candidates that target retinal diseases. 

MRK has increased its dividend for 14 years and the stock yields 3.8%.

Bristol-Myers Squibb (BMY)

Bristol-Myers Squibb was created when Bristol-Myers and Squibb merged on October 4th, 1989. Bristol-Myers can trace its corporate beginnings back to 1887. Today this leading drug maker of cardiovascular and anti-cancer therapeutics has annual revenues of about $46 billion. 

On April 24th, 2025, Bristol-Myers reported first quarter results for the period ending March 31st, 2025. For the quarter, revenue declined 6% to $11.2 billion, but this was $490 million above estimates. Adjusted earnings-per-share of $1.80 compared to -$4.40 in the prior year and was $0.30 better than expected. The steep loss was due to Bristol-Myers closing three transactions during that quarter, including Mirati Therapeutics, Karuna Therapeutics, and RayzeBio. This incurred nearly $13 billion of in-process research and development charges that negatively impacted results for that period and the full year. 

Adjusting for unfavorable currency exchange, revenue fell 4% for the quarter. U.S. revenues declined 7% to $7.9 billion. International was down 2% to $3.3 billion, but revenue grew 2% when excluding currency exchange. Revlimid, which treats myeloma, decreased 44% to $936 billion due to generic competition. Eliquis, which prevents blood clots, was down 4% to $3.6 billion as U.S. demand was offset by changes in Medicare Part D related to legislation to lower drug prices. 

Eliquis remains the top oral anticoagulant outside of the U.S. and generated more than $13 billion in revenue for 2024, which was a 9% increase from the prior year. Camzyos, which helps prevent the heart muscles from thickening, surged 89% to $159 million due to higher demand throughout markets. 

Future growth will be fueled by new products. Reblozyl, which is used to treat anemia in adults with certain blood disorders, improved 35% to $478 million due to new launches. Revenue for Orencia, which treats rheumatoid arthritis, was down 4% to $770 million. Cobenfy, the company’s treatment for schizophrenia, contributed $27 million to results. This product was approved on September 26th, 2024 and was launched in the U.S. during Q4 2024. Peak sales could reach upwards of $5 billion or more by 2030. Other planned registrational studies include Alzheimer’s, Autism, and bipolar disorder. Gross margins contracted 240 basis points to 72.9%. 

Bristol-Myers provided revised guidance for 2025 as well. Adjusted earnings-per-share are projected to be in a range of $6.70 to $6.90 for the year.

BMY has increased its dividend for 18 years and shares currently yield 5.0%.