DE vs UNP: Dividend Yield, Growth & Safety Comparison
Deere & Co (DE) and Union Pacific Corp (UNP) are both in the Industrials sector, making them natural rivals for dividend investors. UNP edges ahead on yield at 2.08% versus DE's 1.09%. For dividend growth, DE leads with a 5-year CAGR of 13.5% versus UNP's 6.1%. Both stocks carry a "Safe" dividend safety rating. DE is a Dividend Challenger while UNP is a Dividend Contender.
Key Metrics Comparison
| Metric | DE | UNP |
|---|
| Dividend Yield | 1.09% | 2.08% |
| Annual Dividend | $6.48 | $5.44 |
| 5-Year CAGR | 13.5% | 6.1% |
| Payout Ratio | 35% | 45% |
| Consecutive Years | 5 | 19 |
| Price | $606.06 | $260.92 |
Yield Comparison
Union Pacific Corp (UNP) currently yields 2.08%, which is solid for the broader market. That's 0.99% more than Deere & Co (DE), which yields 1.09%. In dollar terms, UNP pays $5.44/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 UNP's 6.1%. 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%. UNP: Dividend growth is slowing — the 3-year CAGR of 2.3% trails the 5-year rate of 6.1% and the 10-year rate of 10.3%.
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. UNP's dividend safety is rated "Safe." The payout ratio of 45% is well within sustainable levels, leaving room for future increases. Earnings cover the dividend 2.2x. DE's payout ratio of 35% is more conservative than UNP's 45%, suggesting more room for future increases.
Income Comparison
A $10,000 investment in UNP generates approximately $208/year in dividend income, compared to $109/year from DE — a difference of $99/year. At $100,000, that gap widens to $990/year.
Verdict
- Best for income: UNP
- Best for growth: DE
- Best for safety: DE
Frequently Asked Questions
Which has a higher dividend yield, DE or UNP?
Union Pacific Corp (UNP) has a higher dividend yield of 2.08% compared to Deere & Co (DE) at 1.09%.
Is DE or UNP a better dividend growth stock?
Deere & Co has the stronger dividend growth with a 5-year CAGR of 13.5%, compared to Union Pacific Corp's 6.1%.
Which is safer for dividend income, DE or UNP?
Deere & Co's dividend safety is rated "Safe" while Union Pacific Corp is rated "Safe." 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 45% is well within sustainable levels, leaving room for future increases. Earnings cover the dividend 2.2x.
How much income does $10,000 in DE vs UNP generate?
A $10,000 investment in DE generates approximately $109/year in dividends, while the same amount in UNP generates about $208/year.
Is DE or UNP a Dividend Aristocrat?
Deere & Co is a Dividend Challenger (5 years) and Union Pacific Corp is a Dividend Contender (19 years).
Which has a lower payout ratio, DE or UNP?
Deere & Co has a lower payout ratio of 35% compared to Union Pacific Corp's 45%. A lower payout ratio generally indicates more room for dividend growth and better sustainability.
DE vs UNP: which is better for retirement income?
It depends on your priorities. UNP for current income, DE for dividend growth, DE for safety. Many retirement investors hold both for diversification.
DE Dividend Analysis | UNP Dividend Analysis | All Comparisons | Comparison Tool