SCHD's Top Sector Bet Is Healthcare at 20.7%. I'm Not Sure What's More Surprising: What It Doesn't Hold, or What It Does.

Key Points SCHD holds several high-quality, high-yielding healthcare dividend stocks. Johnson & Johnson and Medtronic aren't on its list of holdings. Its two largest healthcare holdings, Merck and UnitedHealth, have some potential quality issues. 10 stocks we like better than Schwab U.S. Dividend Equity ETF › The Schwab U.S. Dividend Equity ETF (NYSEMKT:SCHD) holds 100 of the highest-quality, high-yielding dividend stocks. The ETF currently has a 20.7% allocation to healthcare stocks, its top sector weighting. What's surprising is that two of the seemingly highest quality healthcare dividend stocks -- Johnson & Johnson (NYSE:JNJ) and Medtronic (NYSE:MDT) -- aren't among its holdings at all.