JNJ vs UNH: Dividend Yield, Growth & Safety Comparison
Johnson & Johnson (JNJ) and Unitedhealth Group Inc (UNH) are both in the Health Care sector, making them natural rivals for dividend investors. UNH offers a significantly higher 3.20% yield compared to JNJ's 2.16%, a gap of 1.04%. For dividend growth, UNH leads with a 5-year CAGR of 11.7% versus JNJ's 5.2%. Both stocks carry a "Safe" dividend safety rating. JNJ is a Dividend King while UNH is a Dividend Contender.
Key Metrics Comparison
| Metric | JNJ | UNH |
|---|
| Dividend Yield | 2.16% | 3.20% |
| Annual Dividend | $5.14 | $8.73 |
| 5-Year CAGR | 5.2% | 11.7% |
| Payout Ratio | 47% | 45% |
| Consecutive Years | 63 | 16 |
| Price | $243.53 | $291.12 |
Yield Comparison
Unitedhealth Group Inc (UNH) currently yields 3.20%, which is solid for the broader market. That's 1.04% more than Johnson & Johnson (JNJ), which yields 2.16%. In dollar terms, UNH pays $8.73/share annually versus JNJ's $5.14/share.
Dividend Growth
Over the past five years, UNH has grown its dividend at a 11.7% 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%. UNH: Dividend growth is slowing — the 3-year CAGR of 9.4% trails the 5-year rate of 11.7% and the 10-year rate of 15.6%.
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. UNH's dividend safety is rated "Safe." The payout ratio of 45% is well within sustainable levels, leaving room for future increases. Earnings cover the dividend 2.2x. Both have similar payout ratios — JNJ at 47% and UNH at 45%.
Income Comparison
A $10,000 investment in UNH generates approximately $320/year in dividend income, compared to $216/year from JNJ — a difference of $104/year. At $100,000, that gap widens to $1040/year.
Verdict
- Best for income: UNH
- Best for growth: UNH
Frequently Asked Questions
Which has a higher dividend yield, JNJ or UNH?
Unitedhealth Group Inc (UNH) has a higher dividend yield of 3.20% compared to Johnson & Johnson (JNJ) at 2.16%.
Is JNJ or UNH a better dividend growth stock?
Unitedhealth Group Inc has the stronger dividend growth with a 5-year CAGR of 11.7%, compared to Johnson & Johnson's 5.2%.
Which is safer for dividend income, JNJ or UNH?
Johnson & Johnson's dividend safety is rated "Safe" while Unitedhealth Group Inc 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 45% is well within sustainable levels, leaving room for future increases. Earnings cover the dividend 2.2x.
How much income does $10,000 in JNJ vs UNH generate?
A $10,000 investment in JNJ generates approximately $216/year in dividends, while the same amount in UNH generates about $320/year.
Is JNJ or UNH a Dividend Aristocrat?
Johnson & Johnson is a Dividend King (63 years) and Unitedhealth Group Inc is a Dividend Contender (16 years).
Which has a lower payout ratio, JNJ or UNH?
Unitedhealth Group Inc has a lower payout ratio of 45% compared to Johnson & Johnson's 47%. A lower payout ratio generally indicates more room for dividend growth and better sustainability.
JNJ vs UNH: which is better for retirement income?
It depends on your priorities. UNH for current income, UNH for dividend growth. Many retirement investors hold both for diversification.
JNJ Dividend Analysis | UNH Dividend Analysis | All Comparisons | Comparison Tool