GWW vs UNP: Dividend Comparison
Dividend data as of
W.W. Grainger, Inc. (GWW) and Union Pacific Corp (UNP) are both in the Industrials sector, making them natural rivals for dividend investors. UNP offers a significantly higher 2.08% yield compared to GWW's 0.74%, a gap of 1.34%. For dividend growth, GWW leads with a 5-year CAGR of 16.1% versus UNP's 6.1%. Both stocks carry a "Safe" dividend safety rating. UNP is a Dividend Contender with 19 years of consecutive increases.
Verdict
Yield Analysis
UNP yields 1.34% more than GWW. In dollar terms, GWW pays $8.83/share vs UNP's $5.44/share annually.
Dividend Growth
GWW: Dividend growth is accelerating — the 3-year CAGR of 25.8% exceeds the 5-year rate of 16.1% and the 10-year rate of 10.3%.
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
GWW: The payout ratio of 25% is well within sustainable levels, leaving room for future increases. Earnings cover the dividend 4.0x.
UNP: The payout ratio of 45% is well within sustainable levels, leaving room for future increases. Earnings cover the dividend 2.2x.
Estimated Annual Dividend Income
Based on current dividend yields. Actual income may vary.
What does $10,000 buy in GWW vs UNP today?
At $1139.68 per share, $10,000 buys about 8.8 shares of W.W. Grainger, Inc. (GWW). Each share pays $8.83 per year in dividends, so the position starts out generating roughly $77 per year — about $6 a month.
At $260.92 per share, $10,000 buys about 38.3 shares of Union Pacific Corp (UNP). Each share pays $5.44 per year in dividends, so the position starts out generating roughly $208 per year — about $17 a month.
UNP is the larger income stream from day one: $131 per year more on the same $10,000 invested.
What could $10,000 of GWW or UNP income look like in 10 years?
W.W. Grainger, Inc. (GWW) has raised its dividend about 16.1% a year over the past five years. If that pace held, the $74 per year that $10,000 generates today at the current 0.74% yield would reach $331 per year by 2036 — a 3.3% yield on the original cost.
Union Pacific Corp (UNP) has raised its dividend about 6.1% a year over the past five years. If that pace held, the $208 per year that $10,000 generates today at the current 2.08% yield would reach $377 per year by 2036 — a 3.8% yield on the original cost.
On those trailing rates, UNP pays more in 2036: $377 versus $331 per year. The projection assumes each five-year growth rate persists and no dividends are reinvested — real payouts will differ.
When would GWW's dividend growth overtake UNP's higher yield?
W.W. Grainger, Inc. (GWW) yields less today (0.74% vs 2.08%) but has grown its dividend faster — 16.1% vs 6.1% a year over the past five years. If both trends continued, a $10,000 position in GWW would start out-earning the same position in UNP around 2038 (roughly 12 years from now), paying about $446 per year at the crossover. Before that point, UNP pays more each year; after it, the gap compounds in GWW's favor.
Can GWW and UNP afford their dividends?
W.W. Grainger, Inc. (GWW) earns $35.35 per share against $8.83 paid out in dividends — 4.0x coverage (a 25% payout ratio).
Union Pacific Corp (UNP) earns $11.98 per share against $5.44 paid out in dividends — 2.2x coverage (a 45% payout ratio).
GWW's wider coverage leaves more cushion if earnings dip. As a rule of thumb, coverage below about 1.5x (a payout ratio above ~65%) is where a dividend starts to look stretched — worth watching for UNP if earnings weaken.
Which fits an early-retirement income portfolio better, GWW or UNP?
For income you need right now, Union Pacific Corp (UNP) leads: $100,000 invested today pays about $173 a month at the current 2.08% yield, versus $62 a month from W.W. Grainger, Inc. (GWW) at 0.74%.
With a decade or more before the income is needed, GWW's faster dividend growth (16.1% vs 6.1% a year) matters more than the starting yield — raises compound into the larger paycheck over time.
On consistency: UNP has raised its dividend 19 consecutive years.
Many income investors simply hold both — the mix pairs current yield with growth and spreads single-name risk. Whichever way you lean, dividends are never guaranteed; recheck the payout each quarter rather than setting and forgetting.
$10,000 with DRIP: projected annual income
If each holding keeps raising its dividend at its real 5-year rate and every payment is reinvested, a $10,000 position pays $356/yr in GWW vs $463/yr in UNP by year 10.
Assumes dividends are reinvested at the current yield and grow at each holding's trailing 5-year dividend CAGR. A projection, not a prediction — no price appreciation modeled.
Track GWW and UNP in your portfolio
See your real income from both — forward projections, yield on cost, and dividend safety signals. Sync your brokerage free for 30 days, or track holdings manually on the free plan.
Frequently Asked Questions
Related Resources
Individual Stock Analysis
Dividend Tools
Track Your Dividends
More Comparisons
This tool is for educational and informational purposes only and does not constitute investment, financial, tax, or legal advice. Consult a licensed professional before making investment decisions.
Past performance does not guarantee future results. All projections are hypothetical estimates based on user-provided inputs and may differ materially from actual outcomes.
By using this tool you agree to our Terms of Service and Privacy Policy.