DE vs HON: Dividend Yield, Growth & Safety Comparison
Deere & Co (DE) and Honeywell International Inc (HON) are both in the Industrials sector, making them natural rivals for dividend investors. HON edges ahead on yield at 1.88% versus DE's 1.09%. For dividend growth, DE leads with a 5-year CAGR of 13.5% versus HON's 5.4%. DE holds the edge in dividend safety with a "Safe" rating. DE is a Dividend Challenger while HON is a Dividend Contender.
Key Metrics Comparison
| Metric | DE | HON |
|---|
| Dividend Yield | 1.09% | 1.88% |
| Annual Dividend | $6.48 | $4.58 |
| 5-Year CAGR | 13.5% | 5.4% |
| Payout Ratio | 35% | 61% |
| Consecutive Years | 5 | 15 |
| Price | $606.06 | $241.59 |
Yield Comparison
Honeywell International Inc (HON) currently yields 1.88%, which is modest for the broader market. That's 0.79% more than Deere & Co (DE), which yields 1.09%. In dollar terms, HON pays $4.58/share annually versus DE's $6.48/share.
Dividend Growth
Over the past five years, DE has grown its dividend at a 13.5% CAGR compared to HON's 5.4%. DE: Dividend growth is slowing — the 3-year CAGR of 10.4% trails the 5-year rate of 13.5% and the 10-year rate of 11.7%. HON: Dividend growth has been steady, with a 3-year CAGR of 5.6% and a 5-year CAGR of 5.4% (10-year: 7.9%).
Dividend Safety
DE's dividend safety is rated "Safe." The payout ratio of 35% is well within sustainable levels, leaving room for future increases. Earnings cover the dividend 2.9x. HON's dividend safety is rated "Moderate." The payout ratio of 61% is moderate. The dividend is currently covered by earnings but leaves less room for growth. Earnings cover the dividend 1.7x. DE's payout ratio of 35% is more conservative than HON's 61%, suggesting more room for future increases.
Income Comparison
A $10,000 investment in HON generates approximately $188/year in dividend income, compared to $109/year from DE — a difference of $79/year. At $100,000, that gap widens to $790/year.
Verdict
- Best for income: HON
- Best for growth: DE
- Best for safety: DE
Frequently Asked Questions
Which has a higher dividend yield, DE or HON?
Honeywell International Inc (HON) has a higher dividend yield of 1.88% compared to Deere & Co (DE) at 1.09%.
Is DE or HON a better dividend growth stock?
Deere & Co has the stronger dividend growth with a 5-year CAGR of 13.5%, compared to Honeywell International Inc's 5.4%.
Which is safer for dividend income, DE or HON?
Deere & Co's dividend safety is rated "Safe" while Honeywell International Inc is rated "Moderate." The payout ratio of 35% is well within sustainable levels, leaving room for future increases. Earnings cover the dividend 2.9x. The payout ratio of 61% is moderate. The dividend is currently covered by earnings but leaves less room for growth. Earnings cover the dividend 1.7x.
How much income does $10,000 in DE vs HON generate?
A $10,000 investment in DE generates approximately $109/year in dividends, while the same amount in HON generates about $188/year.
Is DE or HON a Dividend Aristocrat?
Deere & Co is a Dividend Challenger (5 years) and Honeywell International Inc is a Dividend Contender (15 years).
Which has a lower payout ratio, DE or HON?
Deere & Co has a lower payout ratio of 35% compared to Honeywell International Inc's 61%. A lower payout ratio generally indicates more room for dividend growth and better sustainability.
DE vs HON: which is better for retirement income?
It depends on your priorities. HON for current income, DE for dividend growth, DE for safety. Many retirement investors hold both for diversification.
DE Dividend Analysis | HON Dividend Analysis | All Comparisons | Comparison Tool