BDX vs JNJ: Dividend Comparison
Dividend data as of
Becton Dickinson & Co (BDX) and Johnson & Johnson (JNJ) are both in the Health Care sector, making them natural rivals for dividend investors. Both stocks offer similar yields — BDX at 2.36% and JNJ at 2.16%. Both stocks show similar dividend growth rates, each around 6.2% over the past five years. JNJ holds the edge in dividend safety with a "Safe" rating. BDX is a Dividend Aristocrat while JNJ is a Dividend King.
Verdict
Yield Analysis
BDX yields 0.20% more than JNJ. In dollar terms, BDX pays $4.20/share vs JNJ's $5.14/share annually.
Dividend Growth
BDX: Dividend growth has been steady, with a 3-year CAGR of 6.5% and a 5-year CAGR of 6.2% (10-year: 5.2%).
JNJ: Dividend growth is slowing — the 3-year CAGR of 4.6% trails the 5-year rate of 5.2% and the 10-year rate of 5.6%.
Dividend Safety
BDX: The payout ratio of 68% is moderate. The dividend is currently covered by earnings but leaves less room for growth. Earnings cover the dividend 1.5x.
JNJ: The payout ratio of 47% is well within sustainable levels, leaving room for future increases. Earnings cover the dividend 2.1x.
Estimated Annual Dividend Income
Based on current dividend yields. Actual income may vary.
What does $10,000 buy in BDX vs JNJ today?
At $177.39 per share, $10,000 buys about 56.4 shares of Becton Dickinson & Co (BDX). Each share pays $4.20 per year in dividends, so the position starts out generating roughly $237 per year — about $20 a month.
At $243.53 per share, $10,000 buys about 41.1 shares of Johnson & Johnson (JNJ). Each share pays $5.14 per year in dividends, so the position starts out generating roughly $211 per year — about $18 a month.
BDX is the larger income stream from day one: $26 per year more on the same $10,000 invested.
What could $10,000 of BDX or JNJ income look like in 10 years?
Becton Dickinson & Co (BDX) has raised its dividend about 6.2% a year over the past five years. If that pace held, the $236 per year that $10,000 generates today at the current 2.36% yield would reach $431 per year by 2036 — a 4.3% yield on the original cost.
Johnson & Johnson (JNJ) has raised its dividend about 5.2% a year over the past five years. If that pace held, the $216 per year that $10,000 generates today at the current 2.16% yield would reach $359 per year by 2036 — a 3.6% yield on the original cost.
On those trailing rates, BDX pays more in 2036: $431 versus $359 per year. The projection assumes each five-year growth rate persists and no dividends are reinvested — real payouts will differ.
When would JNJ's dividend growth overtake BDX's higher yield?
It doesn't, on the trailing numbers. Becton Dickinson & Co (BDX) yields more today (2.36% vs 2.16%) and has also grown its dividend at least as fast (6.2% vs 5.2% a year over five years). Unless JNJ accelerates its raises or BDX stumbles, JNJ never closes the income gap — BDX wins on both current income and growth.
Can BDX and JNJ afford their dividends?
Becton Dickinson & Co (BDX) earns $6.12 per share against $4.20 paid out in dividends — 1.5x coverage (a 68% payout ratio).
Johnson & Johnson (JNJ) earns $11.03 per share against $5.14 paid out in dividends — 2.1x coverage (a 47% payout ratio).
JNJ's wider coverage leaves more cushion if earnings dip. As a rule of thumb, coverage below about 1.5x (a payout ratio above ~65%) is where a dividend starts to look stretched — worth watching for BDX if earnings weaken.
Which fits an early-retirement income portfolio better, BDX or JNJ?
For income you need right now, Becton Dickinson & Co (BDX) leads: $100,000 invested today pays about $197 a month at the current 2.36% yield, versus $180 a month from Johnson & Johnson (JNJ) at 2.16%.
BDX also leads on dividend growth (6.2% vs 5.2% a year over five years), so the trailing numbers favor it on both fronts.
On consistency: BDX has raised its dividend 43 consecutive years; JNJ has raised its dividend 63 consecutive years.
Many income investors simply hold both — the mix pairs current yield with growth and spreads single-name risk. Whichever way you lean, dividends are never guaranteed; recheck the payout each quarter rather than setting and forgetting.
$10,000 with DRIP: projected annual income
If each holding keeps raising its dividend at its real 5-year rate and every payment is reinvested, a $10,000 position pays $544/yr in BDX vs $445/yr in JNJ by year 10.
Assumes dividends are reinvested at the current yield and grow at each holding's trailing 5-year dividend CAGR. A projection, not a prediction — no price appreciation modeled.
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