CVS and Bank of Nova Scotia Offer High Dividend Yields, But CVS Lower Risk

CVS Health Corp and Bank of Nova Scotia are appealing high dividend yield stocks with yields above 3%. CVS has lower risk while BNS offers higher 6%+ yield.

Both companies appear undervalued based on P/E ratios below the sector median. CVS has strong diversified business model and economies of scale.

CVS has very attractive dividend with 3.6% forward yield and 10%+ dividend growth rate. BNS also has attractive 6% yield and 4% dividend growth.

CVS receives high Seeking Alpha dividend grades including A- for yield and B+ safety. BNS also scores well with A- yield, B- safety.

Despite higher yield, BNS has more risk of a dividend cut with 67% payout ratio vs 28% for CVS. Recommend underweighting BNS to 2.5% of portfolio.