DOV vs MCD: Dividend Yield, Growth & Safety Comparison
DOVER Corp (DOV) from Industrials and Mcdonalds Corp (MCD) from Consumer Discretionary offer different dividend profiles for income-focused portfolios. MCD offers a significantly higher 2.17% yield compared to DOV's 0.90%, a gap of 1.27%. For dividend growth, MCD leads with a 5-year CAGR of 8.1% versus DOV's 1.0%. DOV holds the edge in dividend safety with a "Safe" rating. DOV is a Dividend Aristocrat while MCD is a Dividend King.
Key Metrics Comparison
| Metric | DOV | MCD |
|---|
| Dividend Yield | 0.90% | 2.17% |
| Annual Dividend | $2.08 | $7.08 |
| 5-Year CAGR | 1.0% | 8.1% |
| Payout Ratio | 26% | 60% |
| Consecutive Years | 41 | 50 |
| Price | $231.16 | $327.89 |
Yield Comparison
Mcdonalds Corp (MCD) currently yields 2.17%, which is solid for the broader market. That's 1.27% more than DOVER Corp (DOV), which yields 0.90%. In dollar terms, MCD pays $7.08/share annually versus DOV's $2.08/share.
Dividend Growth
Over the past five years, MCD has grown its dividend at a 8.1% CAGR compared to DOV's 1.0%. DOV: Dividend growth has been steady, with a 3-year CAGR of 1.0% and a 5-year CAGR of 1.0% (10-year: 4.5%). MCD: Dividend growth is slowing — the 3-year CAGR of 7.3% trails the 5-year rate of 8.1% and the 10-year rate of 7.9%.
Dividend Safety
DOV's dividend safety is rated "Safe." The payout ratio of 26% is well within sustainable levels, leaving room for future increases. Earnings cover the dividend 3.8x. MCD's dividend safety is rated "Moderate." The payout ratio of 60% is moderate. The dividend is currently covered by earnings but leaves less room for growth. Earnings cover the dividend 1.7x. DOV's payout ratio of 26% is more conservative than MCD's 60%, suggesting more room for future increases.
Income Comparison
A $10,000 investment in MCD generates approximately $217/year in dividend income, compared to $90/year from DOV — a difference of $127/year. At $100,000, that gap widens to $1270/year.
Verdict
- Best for income: MCD
- Best for growth: MCD
- Best for safety: DOV
Frequently Asked Questions
Which has a higher dividend yield, DOV or MCD?
Mcdonalds Corp (MCD) has a higher dividend yield of 2.17% compared to DOVER Corp (DOV) at 0.90%.
Is DOV or MCD a better dividend growth stock?
Mcdonalds Corp has the stronger dividend growth with a 5-year CAGR of 8.1%, compared to DOVER Corp's 1.0%.
Which is safer for dividend income, DOV or MCD?
DOVER Corp's dividend safety is rated "Safe" while Mcdonalds Corp is rated "Moderate." The payout ratio of 26% is well within sustainable levels, leaving room for future increases. Earnings cover the dividend 3.8x. The payout ratio of 60% 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 DOV vs MCD generate?
A $10,000 investment in DOV generates approximately $90/year in dividends, while the same amount in MCD generates about $217/year.
Is DOV or MCD a Dividend Aristocrat?
DOVER Corp is a Dividend Aristocrat (41 years) and Mcdonalds Corp is a Dividend King (50 years).
Which has a lower payout ratio, DOV or MCD?
DOVER Corp has a lower payout ratio of 26% compared to Mcdonalds Corp's 60%. A lower payout ratio generally indicates more room for dividend growth and better sustainability.
DOV vs MCD: which is better for retirement income?
It depends on your priorities. MCD for current income, MCD for dividend growth, DOV for safety. Many retirement investors hold both for diversification.
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