BMY vs MRK: Dividend Comparison
Dividend data as of
Bristol Myers Squibb Co (BMY) and Merck & Co., Inc. (MRK) are both in the Health Care sector, making them natural rivals for dividend investors. BMY offers a significantly higher 4.09% yield compared to MRK's 2.77%, a gap of 1.33%. For dividend growth, BMY leads with a 5-year CAGR of 14.0% versus MRK's 5.9%. MRK holds the edge in dividend safety with a "Safe" rating. MRK is a Dividend Contender with 15 years of consecutive increases.
Verdict
Yield Analysis
BMY yields 1.33% more than MRK. In dollar terms, BMY pays $2.49/share vs MRK's $3.24/share annually.
Dividend Growth
BMY: Dividend growth is accelerating — the 3-year CAGR of 20.4% exceeds the 5-year rate of 14.0% and the 10-year rate of 9.0%.
MRK: Dividend growth is slowing — the 3-year CAGR of 5.3% trails the 5-year rate of 5.9% and the 10-year rate of 7.1%.
Dividend Safety
BMY: The payout ratio of 72% is moderate. The dividend is currently covered by earnings but leaves less room for growth. Earnings cover the dividend 1.4x.
MRK: The payout ratio of 45% is well within sustainable levels, leaving room for future increases. Earnings cover the dividend 2.2x.
Estimated Annual Dividend Income
Based on current dividend yields. Actual income may vary.
What does $10,000 buy in BMY vs MRK today?
At $60.77 per share, $10,000 buys about 164.5 shares of Bristol Myers Squibb Co (BMY). Each share pays $2.49 per year in dividends, so the position starts out generating roughly $410 per year — about $34 a month.
At $121.49 per share, $10,000 buys about 82.3 shares of Merck & Co., Inc. (MRK). Each share pays $3.24 per year in dividends, so the position starts out generating roughly $267 per year — about $22 a month.
BMY is the larger income stream from day one: $143 per year more on the same $10,000 invested.
What could $10,000 of BMY or MRK income look like in 10 years?
Bristol Myers Squibb Co (BMY) has raised its dividend about 14.0% a year over the past five years. If that pace held, the $409 per year that $10,000 generates today at the current 4.09% yield would reach $1,513 per year by 2036 — a 15.1% yield on the original cost.
Merck & Co., Inc. (MRK) has raised its dividend about 5.9% a year over the past five years. If that pace held, the $277 per year that $10,000 generates today at the current 2.77% yield would reach $490 per year by 2036 — a 4.9% yield on the original cost.
On those trailing rates, BMY pays more in 2036: $1,513 versus $490 per year. The projection assumes each five-year growth rate persists and no dividends are reinvested — real payouts will differ.
When would MRK's dividend growth overtake BMY's higher yield?
It doesn't, on the trailing numbers. Bristol Myers Squibb Co (BMY) yields more today (4.09% vs 2.77%) and has also grown its dividend at least as fast (14.0% vs 5.9% a year over five years). Unless MRK accelerates its raises or BMY stumbles, MRK never closes the income gap — BMY wins on both current income and growth.
Can BMY and MRK afford their dividends?
Bristol Myers Squibb Co (BMY) earns $3.46 per share against $2.49 paid out in dividends — 1.4x coverage (a 72% payout ratio).
Merck & Co., Inc. (MRK) earns $7.28 per share against $3.24 paid out in dividends — 2.2x coverage (a 45% payout ratio).
MRK'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 BMY if earnings weaken.
Which fits an early-retirement income portfolio better, BMY or MRK?
For income you need right now, Bristol Myers Squibb Co (BMY) leads: $100,000 invested today pays about $341 a month at the current 4.09% yield, versus $230 a month from Merck & Co., Inc. (MRK) at 2.77%.
BMY also leads on dividend growth (14.0% vs 5.9% a year over five years), so the trailing numbers favor it on both fronts.
On consistency: MRK has raised its dividend 15 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 $2,259/yr in BMY vs $643/yr in MRK 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.
Track BMY and MRK in your portfolio
See your real income from both — forward projections, yield on cost, and dividend safety signals. Sync your brokerage free for 30 days, or track holdings manually on the free plan.
Choosing a tracker? See the best dividend trackers compared.
Frequently Asked Questions
Related Resources
Individual Stock Analysis
Dividend Tools
Track Your Dividends
More Comparisons
This tool is for educational and informational purposes only and does not constitute investment, financial, tax, or legal advice. Consult a licensed professional before making investment decisions.
Past performance does not guarantee future results. All projections are hypothetical estimates based on user-provided inputs and may differ materially from actual outcomes.
By using this tool you agree to our Terms of Service and Privacy Policy.