D vs XEL: Dividend Yield, Growth & Safety Comparison
Dominion Energy, Inc (D) and Xcel Energy Inc (XEL) are both in the Utilities sector, making them natural rivals for dividend investors. D offers a significantly higher 4.19% yield compared to XEL's 2.94%, a gap of 1.24%. For dividend growth, XEL leads with a 5-year CAGR of 11.5% versus D's 1.5%. XEL holds the edge in dividend safety with a "Moderate" rating.
Key Metrics Comparison
| Metric | D | XEL |
|---|
| Dividend Yield | 4.19% | 2.94% |
| Annual Dividend | $2.67 | $2.28 |
| 5-Year CAGR | 1.5% | 11.5% |
| Payout Ratio | 87% | 67% |
| Consecutive Years | 0 | 1 |
| Price | $66.31 | $81.32 |
Yield Comparison
Dominion Energy, Inc (D) currently yields 4.19%, which is attractive for the broader market. That's 1.24% more than Xcel Energy Inc (XEL), which yields 2.94%. In dollar terms, D pays $2.67/share annually versus XEL's $2.28/share.
Dividend Growth
Over the past five years, XEL has grown its dividend at a 11.5% CAGR compared to D's 1.5%. D: Dividend growth is slowing — the 3-year CAGR of 0.0% trails the 5-year rate of 1.5% and the 10-year rate of -0.5%. XEL: Dividend growth is accelerating — the 3-year CAGR of 16.6% exceeds the 5-year rate of 11.5% and the 10-year rate of 8.5%.
Dividend Safety
D's dividend safety is rated "At Risk." The payout ratio of 87% is elevated, which may indicate the dividend could be cut if earnings decline. Earnings cover the dividend 1.1x. XEL'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. XEL's payout ratio of 67% is more conservative than D's 87%, suggesting more room for future increases.
Income Comparison
A $10,000 investment in D generates approximately $419/year in dividend income, compared to $294/year from XEL — a difference of $125/year. At $100,000, that gap widens to $1250/year.
Verdict
- Best for income: D
- Best for growth: XEL
- Best for safety: XEL
Frequently Asked Questions
Which has a higher dividend yield, D or XEL?
Dominion Energy, Inc (D) has a higher dividend yield of 4.19% compared to Xcel Energy Inc (XEL) at 2.94%.
Is D or XEL a better dividend growth stock?
Xcel Energy Inc has the stronger dividend growth with a 5-year CAGR of 11.5%, compared to Dominion Energy, Inc's 1.5%.
Which is safer for dividend income, D or XEL?
Dominion Energy, Inc's dividend safety is rated "At Risk" while Xcel Energy Inc is rated "Moderate." The payout ratio of 87% is elevated, which may indicate the dividend could be cut if earnings decline. Earnings cover the dividend 1.1x. 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.
How much income does $10,000 in D vs XEL generate?
A $10,000 investment in D generates approximately $419/year in dividends, while the same amount in XEL generates about $294/year.
Which has a lower payout ratio, D or XEL?
Xcel Energy Inc has a lower payout ratio of 67% compared to Dominion Energy, Inc's 87%. A lower payout ratio generally indicates more room for dividend growth and better sustainability.
D vs XEL: which is better for retirement income?
It depends on your priorities. D for current income, XEL for dividend growth, XEL for safety. Many retirement investors hold both for diversification.
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