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RegExp("[?&]notifications=1(&|#|$)");"desktop"===y&&i&&b.test(window.location.search)&&(i.checked=!0)};be("ybar-mod-notification",(function(e){var t={isUH3:"crunch"===e.getConfig().ytheme,notifContainer:document.getElementById("notification-container"),notifBadge:document.getElementById("notif-badge"),notifMenu:document.getElementById("ybarNotificationMenu"),notifMenuOpener:document.querySelector("#ybarNotificationMenu + label"),notifDropdown:document.getElementById("notifDropdownContainer"),tooltipContainer:document.querySelector(".".concat(Vn)),notifLabel:document.querySelector(".".concat($n))};t.notifDropdown&&ro(e,t)}))}()}};]]>Reuben Gregg Brewer, The Motley FoolSun, Jul 20, 2025, 2:25 PM 4 min readPfizer stands as one of the largest pharmaceutical companies in the world.Although it has an attractive 7.1% yield, it has a big blemish in its dividend past.Investors looking at drug stocks would be better off with this lower-yielding competitor.10 stocks we like better than Pfizer ›One of the big reasons to like Pfizer (NYSE: PFE) today is its huge 7.1% dividend yield. To put that yield into context, the S&P 500 index is yielding roughly 1.3% and the average healthcare stock a bit over 1.7%. Pfizer competitor Merck (NYSE: MRK) is yielding a little more than 4%, yet dividend investors will probably be better off with Merck. Here's why.While Pfizer's dividend yield is clearly much higher than Merck's, both have relatively attractive yields today. And you could easily make the argument that the two pharmaceutical companies basically do the same thing. Thus, you might as well buy the higher-yielding stock here. That isn't an unreasonable position to take.Image source: Getty Images.Essentially, these two industry giants make drugs. They make different drugs, of course, but both are focused on conducting research intended to create new blockbuster drugs that they can sell exclusively until the patents run out. Both have massive and well-funded research and development teams. Both have global distribution systems and strong marketing groups. And both have the scale to buy smaller competitors with promising drugs, if they need to.In the short term, there will be differences between the two with regard to the drugs they have. So at times Pfizer will be better positioned than Merck, and vice versa. Given their vastly different yields, it is pretty clear that Wall Street believes Merck is better positioned right now.Right now, Pfizer has a streak of 15 consecutive dividend increases. Merck's streak is also 15 years long. The issue is what happened roughly 15 years ago. As the chart below shows, Pfizer cut its dividend and Merck did not.PFE Dividend data by YChartsThat was a long time ago, of course, and the business environment was much different. The cut came in the middle of the Great Recession, when there were very real concerns that global financial systems would collapse. Notably, Pfizer cut the dividend at the same time it made a large acquisition.And yet Merck didn't cut its dividend; it has also made large acquisitions in the past, including its own sizable merger in 2009. To be fair, Merck's dividend was static for a long period of time, but going without a dividend increase is much more attractive for an income investor than suffering through a dividend cut.Terms and Privacy PolicyPrivacy & Cookie SettingsMore InfoS&P 5006,305.60 +8.81 (+0.14%)Dow 3044,323.07 -19.12 (-0.04%)Nasdaq20,974.17 +78.52 (+0.38%)Russell 20002,231.13 -8.87 (-0.40%)VIX16.65 +0.24 (+1.46%)Gold3,410.30 +3.90 (+0.11%)PortfolioSign in to access your portfolioSign inTop gainersSTEM Stem, Inc. 16.64 +3.14 (+23.26%)ALAB Astera Labs, Inc. 121.89 +19.76 (+19.35%)CLF Cleveland-Cliffs Inc. 10.66 +1.18 (+12.45%)S SentinelOne, Inc. 19.78 +1.77 (+9.83%)RXRX Recursion Pharmaceuticals, Inc. 6.40 +0.56 (+9.59%)Top losersQS QuantumScape Corporation 12.52 -2.12 (-14.48%)BRKR Bruker Corporation 35.64 -4.92 (-12.12%)NEGG Newegg Commerce, Inc. 26.34 -3.21 (-10.86%)ACHR Archer Aviation Inc. 11.85 -1.44 (-10.84%)AR Antero Resources Corporation 32.51 -3.80 (-10.47%)Most activeOPEN Opendoor Technologies Inc. 3.2100 +0.9600 (+42.67%)LCID Lucid Group, Inc. 2.8200 -0.2200 (-7.24%)QS QuantumScape Corporation 12.52 -2.12 (-14.48%)RIOT Riot Platforms, Inc. 14.02 +0.16 (+1.15%)NVDA NVIDIA Corporation 171.38 -1.03 (-0.60%)Earnings eventsTrending tickersOPEN Opendoor Technologies Inc. 3.2100 +0.9600 (+42.67%)VZ Verizon Communications Inc. 42.49 +1.65 (+4.04%)GOOG Alphabet Inc. 191.15 +5.21 (+2.80%)NXPI NXP Semiconductors N.V. 228.27 +2.37 (+1.05%)ACHR Archer Aviation Inc. 11.85 -1.44 (-10.84%)Top economic events