ES vs SRE: Dividend Yield, Growth & Safety Comparison
Eversource Energy (ES) and Sempra (SRE) are both in the Utilities sector, making them natural rivals for dividend investors. ES offers a significantly higher 4.29% yield compared to SRE's 2.85%, a gap of 1.44%. For dividend growth, ES leads with a 5-year CAGR of 5.7% versus SRE's 4.1%. SRE holds the edge in dividend safety with a "Moderate" rating. ES is a Dividend Aristocrat while SRE is a Dividend Contender.
Key Metrics Comparison
| Metric | ES | SRE |
|---|
| Dividend Yield | 4.29% | 2.85% |
| Annual Dividend | $2.97 | $2.56 |
| 5-Year CAGR | 5.7% | 4.1% |
| Payout Ratio | 82% | 79% |
| Consecutive Years | 26 | 15 |
| Price | $73.58 | $94.71 |
Yield Comparison
Eversource Energy (ES) currently yields 4.29%, which is attractive for the broader market. That's 1.44% more than Sempra (SRE), which yields 2.85%. In dollar terms, ES pays $2.97/share annually versus SRE's $2.56/share.
Dividend Growth
Over the past five years, ES has grown its dividend at a 5.7% CAGR compared to SRE's 4.1%. ES: Dividend growth has been steady, with a 3-year CAGR of 5.6% and a 5-year CAGR of 5.7% (10-year: 6.0%). SRE: Dividend growth has been steady, with a 3-year CAGR of 4.1% and a 5-year CAGR of 4.1% (10-year: 6.1%).
Dividend Safety
ES's dividend safety is rated "At Risk." The payout ratio of 82% is elevated, which may indicate the dividend could be cut if earnings decline. Earnings cover the dividend 1.2x. SRE's dividend safety is rated "Moderate." The payout ratio of 79% is moderate. The dividend is currently covered by earnings but leaves less room for growth. Earnings cover the dividend 1.3x. Both have similar payout ratios — ES at 82% and SRE at 79%.
Income Comparison
A $10,000 investment in ES generates approximately $429/year in dividend income, compared to $285/year from SRE — a difference of $144/year. At $100,000, that gap widens to $1440/year.
Verdict
- Best for income: ES
- Best for growth: ES
- Best for safety: SRE
Frequently Asked Questions
Which has a higher dividend yield, ES or SRE?
Eversource Energy (ES) has a higher dividend yield of 4.29% compared to Sempra (SRE) at 2.85%.
Is ES or SRE a better dividend growth stock?
Eversource Energy has the stronger dividend growth with a 5-year CAGR of 5.7%, compared to Sempra's 4.1%.
Which is safer for dividend income, ES or SRE?
Eversource Energy's dividend safety is rated "At Risk" while Sempra is rated "Moderate." The payout ratio of 82% is elevated, which may indicate the dividend could be cut if earnings decline. Earnings cover the dividend 1.2x. The payout ratio of 79% is moderate. The dividend is currently covered by earnings but leaves less room for growth. Earnings cover the dividend 1.3x.
How much income does $10,000 in ES vs SRE generate?
A $10,000 investment in ES generates approximately $429/year in dividends, while the same amount in SRE generates about $285/year.
Is ES or SRE a Dividend Aristocrat?
Eversource Energy is a Dividend Aristocrat (26 years) and Sempra is a Dividend Contender (15 years).
Which has a lower payout ratio, ES or SRE?
Sempra has a lower payout ratio of 79% compared to Eversource Energy's 82%. A lower payout ratio generally indicates more room for dividend growth and better sustainability.
ES vs SRE: which is better for retirement income?
It depends on your priorities. ES for current income, ES for dividend growth, SRE for safety. Many retirement investors hold both for diversification.
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