HRL vs WMT: Dividend Comparison
Dividend data as of
Hormel Foods Corp /De/ (HRL) and Walmart Inc. (WMT) are both in the Consumer Staples sector, making them natural rivals for dividend investors. HRL offers a significantly higher 4.77% yield compared to WMT's 0.72%, a gap of 4.05%. For dividend growth, HRL leads with a 5-year CAGR of 12.1% versus WMT's 6.4%. Both stocks carry a "Safe" dividend safety rating. WMT is a Dividend Aristocrat with 43 years of consecutive increases.
Verdict
Yield Analysis
HRL yields 4.05% more than WMT. In dollar terms, HRL pays $1.16/share vs WMT's $0.91/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%.
WMT: Dividend growth is accelerating — the 3-year CAGR of 11.2% exceeds the 5-year rate of 6.4% and the 10-year rate of 3.9%.
Dividend Safety
HRL: The payout ratio of 1% is well within sustainable levels, leaving room for future increases. Earnings cover the dividend 0.8x.
WMT: The payout ratio of 32% is well within sustainable levels, leaving room for future increases. Earnings cover the dividend 3.1x.
Estimated Annual Dividend Income
Based on current dividend yields. Actual income may vary.
What does $10,000 buy in HRL vs WMT 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 $133.79 per share, $10,000 buys about 74.7 shares of Walmart Inc. (WMT). Each share pays $0.91 per year in dividends, so the position starts out generating roughly $68 per year — about $6 a month.
HRL is the larger income stream from day one: $420 per year more on the same $10,000 invested.
What could $10,000 of HRL or WMT 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.
Walmart Inc. (WMT) has raised its dividend about 6.4% a year over the past five years. If that pace held, the $72 per year that $10,000 generates today at the current 0.72% yield would reach $134 per year by 2036 — a 1.3% yield on the original cost.
On those trailing rates, HRL pays more in 2036: $1,493 versus $134 per year. The projection assumes each five-year growth rate persists and no dividends are reinvested — real payouts will differ.
When would WMT's dividend growth overtake HRL's higher yield?
It doesn't, on the trailing numbers. Hormel Foods Corp /De/ (HRL) yields more today (4.77% vs 0.72%) and has also grown its dividend at least as fast (12.1% vs 6.4% a year over five years). Unless WMT accelerates its raises or HRL stumbles, WMT never closes the income gap — HRL wins on both current income and growth.
Can HRL and WMT 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).
Walmart Inc. (WMT) earns $2.86 per share against $0.91 paid out in dividends — 3.1x coverage (a 32% payout ratio).
WMT'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 WMT?
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 $60 a month from Walmart Inc. (WMT) at 0.72%.
HRL also leads on dividend growth (12.1% vs 6.4% a year over five years), so the trailing numbers favor it on both fronts.
On consistency: WMT has raised its dividend 43 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 $2,380/yr in HRL vs $144/yr in WMT 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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