O vs SPG: Dividend Comparison
Dividend data as of
Realty Income Corporation (O) and Simon Property Group Inc. (SPG) are both in the Real Estate sector, making them natural rivals for dividend investors. O edges ahead on yield at 5.02% versus SPG's 4.36%. For dividend growth, SPG leads with a 5-year CAGR of 10.0% versus O's 8.2%. O holds the edge in dividend safety with a "Safe" rating.
Verdict
Yield Analysis
O yields 0.66% more than SPG. In dollar terms, O pays $3.21/share vs SPG's $8.55/share annually.
Dividend Growth
O: Dividend growth is accelerating — the 3-year CAGR of 11.4% exceeds the 5-year rate of 8.2% and the 10-year rate of 5.6%.
SPG: Dividend growth is slowing — the 3-year CAGR of 7.1% trails the 5-year rate of 10.0% and the 10-year rate of 6.4%.
Dividend Safety
O: The payout ratio of 3% is well within sustainable levels, leaving room for future increases. Earnings cover the dividend 0.3x.
SPG: The payout ratio of 60% is moderate. The dividend is currently covered by earnings but leaves less room for growth. Earnings cover the dividend 1.7x.
Estimated Annual Dividend Income
Based on current dividend yields. Actual income may vary.
What does $10,000 buy in O vs SPG today?
At $65.62 per share, $10,000 buys about 152.4 shares of Realty Income Corporation (O). Each share pays $3.21 per year in dividends, so the position starts out generating roughly $488 per year — about $41 a month.
At $197.66 per share, $10,000 buys about 50.6 shares of Simon Property Group Inc. (SPG). Each share pays $8.55 per year in dividends, so the position starts out generating roughly $433 per year — about $36 a month.
O is the larger income stream from day one: $56 per year more on the same $10,000 invested.
What could $10,000 of O or SPG income look like in 10 years?
Realty Income Corporation (O) has raised its dividend about 8.2% a year over the past five years. If that pace held, the $502 per year that $10,000 generates today at the current 5.02% yield would reach $1,102 per year by 2036 — a 11.0% yield on the original cost.
Simon Property Group Inc. (SPG) has raised its dividend about 10.0% a year over the past five years. If that pace held, the $436 per year that $10,000 generates today at the current 4.36% yield would reach $1,125 per year by 2036 — a 11.2% yield on the original cost.
On those trailing rates, SPG pays more in 2036: $1,125 versus $1,102 per year. The projection assumes each five-year growth rate persists and no dividends are reinvested — real payouts will differ.
When would SPG's dividend growth overtake O's higher yield?
Simon Property Group Inc. (SPG) yields less today (4.36% vs 5.02%) but has grown its dividend faster — 10.0% vs 8.2% a year over the past five years. If both trends continued, a $10,000 position in SPG would start out-earning the same position in O around 2035 (roughly 9 years from now), paying about $1,023 per year at the crossover. Before that point, O pays more each year; after it, the gap compounds in SPG's favor.
Can O and SPG afford their dividends?
Realty Income Corporation (O) earns $1.07 per share against $3.21 paid out in dividends — 0.3x coverage (a 3% payout ratio).
Simon Property Group Inc. (SPG) earns $14.17 per share against $8.55 paid out in dividends — 1.7x coverage (a 60% payout ratio).
SPG'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 O if earnings weaken.
Which fits an early-retirement income portfolio better, O or SPG?
For income you need right now, Realty Income Corporation (O) leads: $100,000 invested today pays about $418 a month at the current 5.02% yield, versus $363 a month from Simon Property Group Inc. (SPG) at 4.36%.
With a decade or more before the income is needed, SPG's faster dividend growth (10.0% vs 8.2% a year) matters more than the starting yield — raises compound into the larger paycheck over time.
On consistency: SPG has raised its dividend 4 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 $1,798/yr in O vs $1,722/yr in SPG 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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