HRL vs PG: Dividend Comparison
Dividend data as of
Hormel Foods Corp /De/ (HRL) and PROCTER & GAMBLE Co (PG) are both in the Consumer Staples sector, making them natural rivals for dividend investors. HRL offers a significantly higher 4.77% yield compared to PG's 2.63%, a gap of 2.15%. Both stocks show similar dividend growth rates, each around 12.1% over the past five years. HRL holds the edge in dividend safety with a "Safe" rating.
Verdict
Yield Analysis
HRL yields 2.15% more than PG. In dollar terms, HRL pays $1.16/share vs PG's $4.18/share annually.
Dividend Growth
HRL: Dividend growth is accelerating — the 3-year CAGR of 18.6% exceeds the 5-year rate of 12.1% and the 10-year rate of 11.5%.
PG: Dividend growth is accelerating — the 3-year CAGR of 21.6% exceeds the 5-year rate of 12.5% and the 10-year rate of 8.5%.
Dividend Safety
HRL: The payout ratio of 1% is well within sustainable levels, leaving room for future increases. Earnings cover the dividend 0.8x.
PG: The payout ratio of 62% is moderate. The dividend is currently covered by earnings but leaves less room for growth. Earnings cover the dividend 1.6x.
Estimated Annual Dividend Income
Based on current dividend yields. Actual income may vary.
What does $10,000 buy in HRL vs PG today?
At $23.74 per share, $10,000 buys about 421.2 shares of Hormel Foods Corp /De/ (HRL). Each share pays $1.16 per year in dividends, so the position starts out generating roughly $489 per year — about $41 a month.
At $160.56 per share, $10,000 buys about 62.3 shares of PROCTER & GAMBLE Co (PG). Each share pays $4.18 per year in dividends, so the position starts out generating roughly $260 per year — about $22 a month.
HRL is the larger income stream from day one: $228 per year more on the same $10,000 invested.
What could $10,000 of HRL or PG income look like in 10 years?
Hormel Foods Corp /De/ (HRL) has raised its dividend about 12.1% a year over the past five years. If that pace held, the $477 per year that $10,000 generates today at the current 4.77% yield would reach $1,493 per year by 2036 — a 14.9% yield on the original cost.
PROCTER & GAMBLE Co (PG) has raised its dividend about 12.5% a year over the past five years. If that pace held, the $263 per year that $10,000 generates today at the current 2.63% yield would reach $851 per year by 2036 — a 8.5% yield on the original cost.
On those trailing rates, HRL pays more in 2036: $1,493 versus $851 per year. The projection assumes each five-year growth rate persists and no dividends are reinvested — real payouts will differ.
When would PG's dividend growth overtake HRL's higher yield?
Not within a realistic holding period. PROCTER & GAMBLE Co (PG) is growing its dividend faster (12.5% vs 12.1% a year), but the starting-yield gap — 4.77% for HRL vs 2.63% for PG — is wide enough that the crossover sits more than 30 years out on trailing rates. For income you plan to spend, HRL's head start is decisive.
Can HRL and PG afford their dividends?
Hormel Foods Corp /De/ (HRL) earns $0.87 per share against $1.16 paid out in dividends — 0.8x coverage (a 1% payout ratio).
PROCTER & GAMBLE Co (PG) earns $6.75 per share against $4.18 paid out in dividends — 1.6x coverage (a 62% payout ratio).
PG'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 HRL if earnings weaken.
Which fits an early-retirement income portfolio better, HRL or PG?
For income you need right now, Hormel Foods Corp /De/ (HRL) leads: $100,000 invested today pays about $398 a month at the current 4.77% yield, versus $219 a month from PROCTER & GAMBLE Co (PG) at 2.63%.
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 $2,380/yr in HRL vs $1,103/yr in PG 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.
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