JNJ vs TGT: Dividend Yield, Growth & Safety Comparison
Johnson & Johnson (JNJ) from Health Care and Target Corp (TGT) from Consumer Staples offer different dividend profiles for income-focused portfolios. TGT offers a significantly higher 4.01% yield compared to JNJ's 2.16%, a gap of 1.86%. For dividend growth, TGT leads with a 5-year CAGR of 9.4% versus JNJ's 5.2%. Both stocks carry a "Safe" dividend safety rating. JNJ is a Dividend King while TGT is a Dividend Aristocrat.
Key Metrics Comparison
| Metric | JNJ | TGT |
|---|
| Dividend Yield | 2.16% | 4.01% |
| Annual Dividend | $5.14 | $4.50 |
| 5-Year CAGR | 5.2% | 9.4% |
| Payout Ratio | 47% | 55% |
| Consecutive Years | 63 | 42 |
| Price | $243.53 | $115.49 |
Yield Comparison
Target Corp (TGT) currently yields 4.01%, which is attractive for the broader market. That's 1.86% more than Johnson & Johnson (JNJ), which yields 2.16%. In dollar terms, TGT pays $4.50/share annually versus JNJ's $5.14/share.
Dividend Growth
Over the past five years, TGT has grown its dividend at a 9.4% CAGR compared to JNJ's 5.2%. JNJ: Dividend growth is slowing — the 3-year CAGR of 4.6% trails the 5-year rate of 5.2% and the 10-year rate of 5.6%. TGT: Dividend growth is slowing — the 3-year CAGR of 1.8% trails the 5-year rate of 9.4% and the 10-year rate of 11.1%.
Dividend Safety
JNJ's dividend safety is rated "Safe." The payout ratio of 47% is well within sustainable levels, leaving room for future increases. Earnings cover the dividend 2.1x. TGT's dividend safety is rated "Safe." The payout ratio of 55% is well within sustainable levels, leaving room for future increases. Earnings cover the dividend 1.8x. JNJ's payout ratio of 47% is more conservative than TGT's 55%, suggesting more room for future increases.
Income Comparison
A $10,000 investment in TGT generates approximately $401/year in dividend income, compared to $216/year from JNJ — a difference of $185/year. At $100,000, that gap widens to $1850/year.
Verdict
- Best for income: TGT
- Best for growth: TGT
- Best for safety: JNJ
Frequently Asked Questions
Which has a higher dividend yield, JNJ or TGT?
Target Corp (TGT) has a higher dividend yield of 4.01% compared to Johnson & Johnson (JNJ) at 2.16%.
Is JNJ or TGT a better dividend growth stock?
Target Corp has the stronger dividend growth with a 5-year CAGR of 9.4%, compared to Johnson & Johnson's 5.2%.
Which is safer for dividend income, JNJ or TGT?
Johnson & Johnson's dividend safety is rated "Safe" while Target Corp is rated "Safe." The payout ratio of 47% is well within sustainable levels, leaving room for future increases. Earnings cover the dividend 2.1x. The payout ratio of 55% is well within sustainable levels, leaving room for future increases. Earnings cover the dividend 1.8x.
How much income does $10,000 in JNJ vs TGT generate?
A $10,000 investment in JNJ generates approximately $216/year in dividends, while the same amount in TGT generates about $401/year.
Is JNJ or TGT a Dividend Aristocrat?
Johnson & Johnson is a Dividend King (63 years) and Target Corp is a Dividend Aristocrat (42 years).
Which has a lower payout ratio, JNJ or TGT?
Johnson & Johnson has a lower payout ratio of 47% compared to Target Corp's 55%. A lower payout ratio generally indicates more room for dividend growth and better sustainability.
JNJ vs TGT: which is better for retirement income?
It depends on your priorities. TGT for current income, TGT for dividend growth, JNJ for safety. Many retirement investors hold both for diversification.
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