DOW vs NUE: Dividend Yield, Growth & Safety Comparison
Dow Inc. (DOW) and Nucor Corp (NUE) are both in the Materials sector, making them natural rivals for dividend investors. DOW offers a significantly higher 6.25% yield compared to NUE's 1.15%, a gap of 5.10%. For dividend growth, NUE leads with a 5-year CAGR of 6.5% versus DOW's -6.9%. Both stocks carry a "Safe" dividend safety rating. NUE is a Dividend Contender with 16 years of consecutive increases.
Key Metrics Comparison
| Metric | DOW | NUE |
|---|
| Dividend Yield | 6.25% | 1.15% |
| Annual Dividend | $2.10 | $2.21 |
| 5-Year CAGR | -6.9% | 6.5% |
| Payout Ratio | 7% | 29% |
| Consecutive Years | 0 | 16 |
| Price | $32.60 | $182.61 |
Yield Comparison
Dow Inc. (DOW) currently yields 6.25%, which is attractive for the broader market. That's 5.10% more than Nucor Corp (NUE), which yields 1.15%. In dollar terms, DOW pays $2.10/share annually versus NUE's $2.21/share.
Dividend Growth
Over the past five years, NUE has grown its dividend at a 6.5% CAGR compared to DOW's -6.9%. DOW: Dividend growth is slowing — the 3-year CAGR of -13.4% trails the 5-year rate of -6.9% and the 10-year rate of 0.0%. NUE: Dividend growth is slowing — the 3-year CAGR of 3.3% trails the 5-year rate of 6.5% and the 10-year rate of 4.4%.
Dividend Safety
DOW's dividend safety is rated "Safe." The payout ratio of 7% is well within sustainable levels, leaving room for future increases. Earnings cover the dividend -1.8x. NUE's dividend safety is rated "Safe." The payout ratio of 29% is well within sustainable levels, leaving room for future increases. Earnings cover the dividend 3.4x. DOW's payout ratio of 7% is more conservative than NUE's 29%, suggesting more room for future increases.
Income Comparison
A $10,000 investment in DOW generates approximately $625/year in dividend income, compared to $115/year from NUE — a difference of $510/year. At $100,000, that gap widens to $5100/year.
Verdict
- Best for income: DOW
- Best for growth: NUE
- Best for safety: DOW
Frequently Asked Questions
Which has a higher dividend yield, DOW or NUE?
Dow Inc. (DOW) has a higher dividend yield of 6.25% compared to Nucor Corp (NUE) at 1.15%.
Is DOW or NUE a better dividend growth stock?
Nucor Corp has the stronger dividend growth with a 5-year CAGR of 6.5%, compared to Dow Inc.'s -6.9%.
Which is safer for dividend income, DOW or NUE?
Dow Inc.'s dividend safety is rated "Safe" while Nucor Corp is rated "Safe." The payout ratio of 7% is well within sustainable levels, leaving room for future increases. Earnings cover the dividend -1.8x. The payout ratio of 29% is well within sustainable levels, leaving room for future increases. Earnings cover the dividend 3.4x.
How much income does $10,000 in DOW vs NUE generate?
A $10,000 investment in DOW generates approximately $625/year in dividends, while the same amount in NUE generates about $115/year.
Is DOW or NUE a Dividend Aristocrat?
Nucor Corp is a Dividend Contender with 16 consecutive years of increases. Dow Inc. does not currently qualify for aristocrat status.
Which has a lower payout ratio, DOW or NUE?
Dow Inc. has a lower payout ratio of 7% compared to Nucor Corp's 29%. A lower payout ratio generally indicates more room for dividend growth and better sustainability.
DOW vs NUE: which is better for retirement income?
It depends on your priorities. DOW for current income, NUE for dividend growth, DOW for safety. Many retirement investors hold both for diversification.
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