KMI vs XOM: Dividend Yield, Growth & Safety Comparison
Kinder Morgan, Inc. (KMI) and Exxon Mobil Corp (XOM) are both in the Energy sector, making them natural rivals for dividend investors. KMI offers a significantly higher 3.77% yield compared to XOM's 2.64%, a gap of 1.13%. For dividend growth, XOM leads with a 5-year CAGR of 11.2% versus KMI's 9.6%. XOM holds the edge in dividend safety with a "Safe" rating. XOM is a Dividend Aristocrat with 42 years of consecutive increases.
Key Metrics Comparison
| Metric | KMI | XOM |
|---|
| Dividend Yield | 3.77% | 2.64% |
| Annual Dividend | $1.17 | $4.00 |
| 5-Year CAGR | 9.6% | 11.2% |
| Payout Ratio | 85% | 60% |
| Consecutive Years | 0 | 42 |
| Price | $32.20 | $148.59 |
Yield Comparison
Kinder Morgan, Inc. (KMI) currently yields 3.77%, which is solid for the broader market. That's 1.13% more than Exxon Mobil Corp (XOM), which yields 2.64%. In dollar terms, KMI pays $1.17/share annually versus XOM's $4.00/share.
Dividend Growth
Over the past five years, XOM has grown its dividend at a 11.2% CAGR compared to KMI's 9.6%. KMI: Dividend growth is accelerating — the 3-year CAGR of 17.2% exceeds the 5-year rate of 9.6% and the 10-year rate of 13.4%. XOM: Dividend growth is slowing — the 3-year CAGR of 4.3% trails the 5-year rate of 11.2% and the 10-year rate of 6.6%.
Dividend Safety
KMI's dividend safety is rated "At Risk." The payout ratio of 85% is elevated, which may indicate the dividend could be cut if earnings decline. Earnings cover the dividend 1.2x. XOM's dividend safety is rated "Safe." The payout ratio of 60% is well within sustainable levels, leaving room for future increases. Earnings cover the dividend 1.7x. XOM's payout ratio of 60% is more conservative than KMI's 85%, suggesting more room for future increases.
Income Comparison
A $10,000 investment in KMI generates approximately $377/year in dividend income, compared to $264/year from XOM — a difference of $113/year. At $100,000, that gap widens to $1130/year.
Verdict
- Best for income: KMI
- Best for growth: XOM
- Best for safety: XOM
Frequently Asked Questions
Which has a higher dividend yield, KMI or XOM?
Kinder Morgan, Inc. (KMI) has a higher dividend yield of 3.77% compared to Exxon Mobil Corp (XOM) at 2.64%.
Is KMI or XOM a better dividend growth stock?
Exxon Mobil Corp has the stronger dividend growth with a 5-year CAGR of 11.2%, compared to Kinder Morgan, Inc.'s 9.6%.
Which is safer for dividend income, KMI or XOM?
Kinder Morgan, Inc.'s dividend safety is rated "At Risk" while Exxon Mobil Corp is rated "Safe." The payout ratio of 85% is elevated, which may indicate the dividend could be cut if earnings decline. Earnings cover the dividend 1.2x. The payout ratio of 60% is well within sustainable levels, leaving room for future increases. Earnings cover the dividend 1.7x.
How much income does $10,000 in KMI vs XOM generate?
A $10,000 investment in KMI generates approximately $377/year in dividends, while the same amount in XOM generates about $264/year.
Is KMI or XOM a Dividend Aristocrat?
Exxon Mobil Corp is a Dividend Aristocrat with 42 consecutive years of increases. Kinder Morgan, Inc. does not currently qualify for aristocrat status.
Which has a lower payout ratio, KMI or XOM?
Exxon Mobil Corp has a lower payout ratio of 60% compared to Kinder Morgan, Inc.'s 85%. A lower payout ratio generally indicates more room for dividend growth and better sustainability.
KMI vs XOM: which is better for retirement income?
It depends on your priorities. KMI for current income, XOM for dividend growth, XOM for safety. Many retirement investors hold both for diversification.
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