MKC vs WMT: Dividend Comparison
Dividend data as of
Mccormick & Co Inc (MKC) and Walmart Inc. (WMT) are both in the Consumer Staples sector, making them natural rivals for dividend investors. MKC offers a significantly higher 2.61% yield compared to WMT's 0.72%, a gap of 1.89%. Both stocks show similar dividend growth rates, each around 7.1% over the past five years. WMT holds the edge in dividend safety with a "Safe" rating. Both are classified as Dividend Aristocrats.
Verdict
Yield Analysis
MKC yields 1.89% more than WMT. In dollar terms, MKC pays $1.80/share vs WMT's $0.91/share annually.
Dividend Growth
MKC: Dividend growth has been steady, with a 3-year CAGR of 7.3% and a 5-year CAGR of 7.1% (10-year: 8.5%).
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
MKC: The payout ratio of 61% is moderate. The dividend is currently covered by earnings but leaves less room for growth. Earnings cover the dividend 1.6x.
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 MKC vs WMT today?
At $71.91 per share, $10,000 buys about 139.1 shares of Mccormick & Co Inc (MKC). Each share pays $1.80 per year in dividends, so the position starts out generating roughly $250 per year — about $21 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.
MKC is the larger income stream from day one: $182 per year more on the same $10,000 invested.
What could $10,000 of MKC or WMT income look like in 10 years?
Mccormick & Co Inc (MKC) has raised its dividend about 7.1% a year over the past five years. If that pace held, the $261 per year that $10,000 generates today at the current 2.61% yield would reach $519 per year by 2036 — a 5.2% 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, MKC pays more in 2036: $519 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 MKC's higher yield?
It doesn't, on the trailing numbers. Mccormick & Co Inc (MKC) yields more today (2.61% vs 0.72%) and has also grown its dividend at least as fast (7.1% vs 6.4% a year over five years). Unless WMT accelerates its raises or MKC stumbles, WMT never closes the income gap — MKC wins on both current income and growth.
Can MKC and WMT afford their dividends?
Mccormick & Co Inc (MKC) earns $2.93 per share against $1.80 paid out in dividends — 1.6x coverage (a 61% 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 MKC if earnings weaken.
Which fits an early-retirement income portfolio better, MKC or WMT?
For income you need right now, Mccormick & Co Inc (MKC) leads: $100,000 invested today pays about $218 a month at the current 2.61% yield, versus $60 a month from Walmart Inc. (WMT) at 0.72%.
MKC also leads on dividend growth (7.1% vs 6.4% a year over five years), so the trailing numbers favor it on both fronts.
On consistency: MKC has raised its dividend 27 consecutive years; 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 $672/yr in MKC 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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