AMGN vs UNH: Dividend Yield, Growth & Safety Comparison
Amgen Inc (AMGN) and Unitedhealth Group Inc (UNH) are both in the Health Care sector, making them natural rivals for dividend investors. UNH edges ahead on yield at 3.20% versus AMGN's 2.61%. For dividend growth, AMGN leads with a 5-year CAGR of 15.9% versus UNH's 11.7%. UNH holds the edge in dividend safety with a "Safe" rating. Both are classified as Dividend Contenders.
Key Metrics Comparison
| Metric | AMGN | UNH |
|---|
| Dividend Yield | 2.61% | 3.20% |
| Annual Dividend | $9.52 | $8.73 |
| 5-Year CAGR | 15.9% | 11.7% |
| Payout Ratio | 67% | 45% |
| Consecutive Years | 14 | 16 |
| Price | $369.70 | $291.12 |
Yield Comparison
Unitedhealth Group Inc (UNH) currently yields 3.20%, which is solid for the broader market. That's 0.58% more than Amgen Inc (AMGN), which yields 2.61%. In dollar terms, UNH pays $8.73/share annually versus AMGN's $9.52/share.
Dividend Growth
Over the past five years, AMGN has grown its dividend at a 15.9% CAGR compared to UNH's 11.7%. AMGN: Dividend growth is slowing — the 3-year CAGR of 5.7% trails the 5-year rate of 15.9% and the 10-year rate of 13.7%. UNH: Dividend growth is slowing — the 3-year CAGR of 9.4% trails the 5-year rate of 11.7% and the 10-year rate of 15.6%.
Dividend Safety
AMGN's dividend safety is rated "Moderate." The payout ratio of 67% is moderate. The dividend is currently covered by earnings but leaves less room for growth. Earnings cover the dividend 1.5x. UNH's dividend safety is rated "Safe." The payout ratio of 45% is well within sustainable levels, leaving room for future increases. Earnings cover the dividend 2.2x. UNH's payout ratio of 45% is more conservative than AMGN's 67%, suggesting more room for future increases.
Income Comparison
A $10,000 investment in UNH generates approximately $320/year in dividend income, compared to $261/year from AMGN — a difference of $59/year. At $100,000, that gap widens to $590/year.
Verdict
- Best for income: UNH
- Best for growth: AMGN
- Best for safety: UNH
Frequently Asked Questions
Which has a higher dividend yield, AMGN or UNH?
Unitedhealth Group Inc (UNH) has a higher dividend yield of 3.20% compared to Amgen Inc (AMGN) at 2.61%.
Is AMGN or UNH a better dividend growth stock?
Amgen Inc has the stronger dividend growth with a 5-year CAGR of 15.9%, compared to Unitedhealth Group Inc's 11.7%.
Which is safer for dividend income, AMGN or UNH?
Amgen Inc's dividend safety is rated "Moderate" while Unitedhealth Group Inc is rated "Safe." The payout ratio of 67% is moderate. The dividend is currently covered by earnings but leaves less room for growth. Earnings cover the dividend 1.5x. The payout ratio of 45% is well within sustainable levels, leaving room for future increases. Earnings cover the dividend 2.2x.
How much income does $10,000 in AMGN vs UNH generate?
A $10,000 investment in AMGN generates approximately $261/year in dividends, while the same amount in UNH generates about $320/year.
Is AMGN or UNH a Dividend Aristocrat?
Amgen Inc is a Dividend Contender (14 years) and Unitedhealth Group Inc is a Dividend Contender (16 years).
Which has a lower payout ratio, AMGN or UNH?
Unitedhealth Group Inc has a lower payout ratio of 45% compared to Amgen Inc's 67%. A lower payout ratio generally indicates more room for dividend growth and better sustainability.
AMGN vs UNH: which is better for retirement income?
It depends on your priorities. UNH for current income, AMGN for dividend growth, UNH for safety. Many retirement investors hold both for diversification.
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