BAC vs C: Dividend Yield, Growth & Safety Comparison
Bank Of America Corp /De/ (BAC) and Citigroup Inc (C) are both in the Financials sector, making them natural rivals for dividend investors. Both stocks offer similar yields — BAC at 1.95% and C at 1.90%. For dividend growth, C leads with a 5-year CAGR of 11.0% versus BAC's 8.5%. Both stocks carry a "Safe" dividend safety rating. BAC is a Dividend Contender with 12 years of consecutive increases.
Key Metrics Comparison
| Metric | BAC | C |
|---|
| Dividend Yield | 1.95% | 1.90% |
| Annual Dividend | $1.08 | $2.32 |
| 5-Year CAGR | 8.5% | 11.0% |
| Payout Ratio | 28% | 33% |
| Consecutive Years | 12 | 0 |
| Price | $52.38 | $110.67 |
Yield Comparison
Bank Of America Corp /De/ (BAC) currently yields 1.95%, which is modest for the broader market. That's 0.05% more than Citigroup Inc (C), which yields 1.90%. In dollar terms, BAC pays $1.08/share annually versus C's $2.32/share.
Dividend Growth
Over the past five years, C has grown its dividend at a 11.0% CAGR compared to BAC's 8.5%. BAC: Dividend growth has been steady, with a 3-year CAGR of 8.3% and a 5-year CAGR of 8.5% (10-year: 17.6%). C: Dividend growth is accelerating — the 3-year CAGR of 21.6% exceeds the 5-year rate of 11.0% and the 10-year rate of 22.6%.
Dividend Safety
BAC's dividend safety is rated "Safe." The payout ratio of 28% is well within sustainable levels, leaving room for future increases. Earnings cover the dividend 3.5x. C's dividend safety is rated "Safe." The payout ratio of 33% is well within sustainable levels, leaving room for future increases. Earnings cover the dividend 3.0x. Both have similar payout ratios — BAC at 28% and C at 33%.
Income Comparison
A $10,000 investment in BAC generates approximately $195/year in dividend income, compared to $190/year from C — a difference of $5/year. At $100,000, that gap widens to $50/year.
Verdict
- Best for income: BAC
- Best for growth: C
- Best for safety: BAC
Frequently Asked Questions
Which has a higher dividend yield, BAC or C?
Bank Of America Corp /De/ (BAC) has a higher dividend yield of 1.95% compared to Citigroup Inc (C) at 1.90%.
Is BAC or C a better dividend growth stock?
Citigroup Inc has the stronger dividend growth with a 5-year CAGR of 11.0%, compared to Bank Of America Corp /De/'s 8.5%.
Which is safer for dividend income, BAC or C?
Bank Of America Corp /De/'s dividend safety is rated "Safe" while Citigroup Inc is rated "Safe." The payout ratio of 28% is well within sustainable levels, leaving room for future increases. Earnings cover the dividend 3.5x. The payout ratio of 33% is well within sustainable levels, leaving room for future increases. Earnings cover the dividend 3.0x.
How much income does $10,000 in BAC vs C generate?
A $10,000 investment in BAC generates approximately $195/year in dividends, while the same amount in C generates about $190/year.
Is BAC or C a Dividend Aristocrat?
Bank Of America Corp /De/ is a Dividend Contender with 12 consecutive years of increases. Citigroup Inc does not currently qualify for aristocrat status.
Which has a lower payout ratio, BAC or C?
Bank Of America Corp /De/ has a lower payout ratio of 28% compared to Citigroup Inc's 33%. A lower payout ratio generally indicates more room for dividend growth and better sustainability.
BAC vs C: which is better for retirement income?
It depends on your priorities. BAC for current income, C for dividend growth, BAC for safety. Many retirement investors hold both for diversification.
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