HON vs MMM: Dividend Yield, Growth & Safety Comparison
Honeywell International Inc (HON) and 3M Co (MMM) are both in the Industrials sector, making them natural rivals for dividend investors. Both stocks offer similar yields — HON at 1.88% and MMM at 1.79%. For dividend growth, HON leads with a 5-year CAGR of 5.4% versus MMM's -5.8%. MMM holds the edge in dividend safety with a "Safe" rating. HON is a Dividend Contender with 15 years of consecutive increases.
Key Metrics Comparison
| Metric | HON | MMM |
|---|
| Dividend Yield | 1.88% | 1.79% |
| Annual Dividend | $4.58 | $3.12 |
| 5-Year CAGR | 5.4% | -5.8% |
| Payout Ratio | 61% | 49% |
| Consecutive Years | 15 | 0 |
| Price | $241.59 | $171.81 |
Yield Comparison
Honeywell International Inc (HON) currently yields 1.88%, which is modest for the broader market. That's 0.09% more than 3M Co (MMM), which yields 1.79%. In dollar terms, HON pays $4.58/share annually versus MMM's $3.12/share.
Dividend Growth
Over the past five years, HON has grown its dividend at a 5.4% CAGR compared to MMM's -5.8%. HON: Dividend growth has been steady, with a 3-year CAGR of 5.6% and a 5-year CAGR of 5.4% (10-year: 7.9%). MMM: Dividend growth is slowing — the 3-year CAGR of -23.7% trails the 5-year rate of -5.8% and the 10-year rate of 0.5%.
Dividend Safety
HON's dividend safety is rated "Moderate." The payout ratio of 61% is moderate. The dividend is currently covered by earnings but leaves less room for growth. Earnings cover the dividend 1.7x. MMM's dividend safety is rated "Safe." The payout ratio of 49% is well within sustainable levels, leaving room for future increases. Earnings cover the dividend 1.9x. MMM's payout ratio of 49% is more conservative than HON's 61%, suggesting more room for future increases.
Income Comparison
A $10,000 investment in HON generates approximately $188/year in dividend income, compared to $179/year from MMM — a difference of $9/year. At $100,000, that gap widens to $90/year.
Verdict
- Best for income: HON
- Best for growth: HON
- Best for safety: MMM
Frequently Asked Questions
Which has a higher dividend yield, HON or MMM?
Honeywell International Inc (HON) has a higher dividend yield of 1.88% compared to 3M Co (MMM) at 1.79%.
Is HON or MMM a better dividend growth stock?
Honeywell International Inc has the stronger dividend growth with a 5-year CAGR of 5.4%, compared to 3M Co's -5.8%.
Which is safer for dividend income, HON or MMM?
Honeywell International Inc's dividend safety is rated "Moderate" while 3M Co is rated "Safe." The payout ratio of 61% is moderate. The dividend is currently covered by earnings but leaves less room for growth. Earnings cover the dividend 1.7x. The payout ratio of 49% is well within sustainable levels, leaving room for future increases. Earnings cover the dividend 1.9x.
How much income does $10,000 in HON vs MMM generate?
A $10,000 investment in HON generates approximately $188/year in dividends, while the same amount in MMM generates about $179/year.
Is HON or MMM a Dividend Aristocrat?
Honeywell International Inc is a Dividend Contender with 15 consecutive years of increases. 3M Co does not currently qualify for aristocrat status.
Which has a lower payout ratio, HON or MMM?
3M Co has a lower payout ratio of 49% compared to Honeywell International Inc's 61%. A lower payout ratio generally indicates more room for dividend growth and better sustainability.
HON vs MMM: which is better for retirement income?
It depends on your priorities. HON for current income, HON for dividend growth, MMM for safety. Many retirement investors hold both for diversification.
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