LLY vs UNH: Dividend Yield, Growth & Safety Comparison
ELI LILLY & Co (LLY) 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 LLY's 0.59%, a gap of 2.61%. For dividend growth, LLY leads with a 5-year CAGR of 23.8% versus UNH's 11.7%. Both stocks carry a "Safe" dividend safety rating. Both are classified as Dividend Contenders.
Key Metrics Comparison
| Metric | LLY | UNH |
|---|
| Dividend Yield | 0.59% | 3.20% |
| Annual Dividend | $6.00 | $8.73 |
| 5-Year CAGR | 23.8% | 11.7% |
| Payout Ratio | 26% | 45% |
| Consecutive Years | 11 | 16 |
| Price | $1045.09 | $291.12 |
Yield Comparison
Unitedhealth Group Inc (UNH) currently yields 3.20%, which is solid for the broader market. That's 2.61% more than ELI LILLY & Co (LLY), which yields 0.59%. In dollar terms, UNH pays $8.73/share annually versus LLY's $6.00/share.
Dividend Growth
Over the past five years, LLY has grown its dividend at a 23.8% CAGR compared to UNH's 11.7%. LLY: Dividend growth is slowing — the 3-year CAGR of 15.2% trails the 5-year rate of 23.8% and the 10-year rate of 16.4%. 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
LLY's dividend safety is rated "Safe." The payout ratio of 26% is well within sustainable levels, leaving room for future increases. Earnings cover the dividend 3.8x. 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. LLY's payout ratio of 26% is more conservative than UNH's 45%, suggesting more room for future increases.
Income Comparison
A $10,000 investment in UNH generates approximately $320/year in dividend income, compared to $59/year from LLY — a difference of $261/year. At $100,000, that gap widens to $2610/year.
Verdict
- Best for income: UNH
- Best for growth: LLY
- Best for safety: LLY
Frequently Asked Questions
Which has a higher dividend yield, LLY or UNH?
Unitedhealth Group Inc (UNH) has a higher dividend yield of 3.20% compared to ELI LILLY & Co (LLY) at 0.59%.
Is LLY or UNH a better dividend growth stock?
ELI LILLY & Co has the stronger dividend growth with a 5-year CAGR of 23.8%, compared to Unitedhealth Group Inc's 11.7%.
Which is safer for dividend income, LLY or UNH?
ELI LILLY & Co's dividend safety is rated "Safe" while Unitedhealth Group Inc is rated "Safe." The payout ratio of 26% is well within sustainable levels, leaving room for future increases. Earnings cover the dividend 3.8x. 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 LLY vs UNH generate?
A $10,000 investment in LLY generates approximately $59/year in dividends, while the same amount in UNH generates about $320/year.
Is LLY or UNH a Dividend Aristocrat?
ELI LILLY & Co is a Dividend Contender (11 years) and Unitedhealth Group Inc is a Dividend Contender (16 years).
Which has a lower payout ratio, LLY or UNH?
ELI LILLY & Co has a lower payout ratio of 26% compared to Unitedhealth Group Inc's 45%. A lower payout ratio generally indicates more room for dividend growth and better sustainability.
LLY vs UNH: which is better for retirement income?
It depends on your priorities. UNH for current income, LLY for dividend growth, LLY for safety. Many retirement investors hold both for diversification.
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