PFE vs UNH: Dividend Comparison
Dividend data as of
Pfizer Inc (PFE) and Unitedhealth Group Inc (UNH) are both in the Health Care sector, making them natural rivals for dividend investors. PFE offers a significantly higher 6.23% yield compared to UNH's 3.20%, a gap of 3.03%. For dividend growth, UNH leads with a 5-year CAGR of 11.7% versus PFE's 10.1%. Both stocks carry a "Safe" dividend safety rating. UNH is a Dividend Contender with 16 years of consecutive increases.
Verdict
Yield Analysis
PFE yields 3.03% more than UNH. In dollar terms, PFE pays $1.72/share vs UNH's $8.73/share annually.
Dividend Growth
PFE: Dividend growth is accelerating — the 3-year CAGR of 18.3% exceeds the 5-year rate of 10.1% and the 10-year rate of 8.1%.
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
PFE: The payout ratio of 1% is well within sustainable levels, leaving room for future increases. Earnings cover the dividend 0.8x.
UNH: The payout ratio of 45% is well within sustainable levels, leaving room for future increases. Earnings cover the dividend 2.2x.
Estimated Annual Dividend Income
Based on current dividend yields. Actual income may vary.
What does $10,000 buy in PFE vs UNH today?
At $27.80 per share, $10,000 buys about 359.8 shares of Pfizer Inc (PFE). Each share pays $1.72 per year in dividends, so the position starts out generating roughly $619 per year — about $52 a month.
At $291.12 per share, $10,000 buys about 34.4 shares of Unitedhealth Group Inc (UNH). Each share pays $8.73 per year in dividends, so the position starts out generating roughly $300 per year — about $25 a month.
PFE is the larger income stream from day one: $319 per year more on the same $10,000 invested.
What could $10,000 of PFE or UNH income look like in 10 years?
Pfizer Inc (PFE) has raised its dividend about 10.1% a year over the past five years. If that pace held, the $623 per year that $10,000 generates today at the current 6.23% yield would reach $1,632 per year by 2036 — a 16.3% yield on the original cost.
Unitedhealth Group Inc (UNH) has raised its dividend about 11.7% a year over the past five years. If that pace held, the $320 per year that $10,000 generates today at the current 3.20% yield would reach $970 per year by 2036 — a 9.7% yield on the original cost.
On those trailing rates, PFE pays more in 2036: $1,632 versus $970 per year. The projection assumes each five-year growth rate persists and no dividends are reinvested — real payouts will differ.
When would UNH's dividend growth overtake PFE's higher yield?
Not within a realistic holding period. Unitedhealth Group Inc (UNH) is growing its dividend faster (11.7% vs 10.1% a year), but the starting-yield gap — 6.23% for PFE vs 3.20% for UNH — is wide enough that the crossover sits more than 30 years out on trailing rates. For income you plan to spend, PFE's head start is decisive.
Can PFE and UNH afford their dividends?
Pfizer Inc (PFE) earns $1.36 per share against $1.72 paid out in dividends — 0.8x coverage (a 1% payout ratio).
Unitedhealth Group Inc (UNH) earns $19.19 per share against $8.73 paid out in dividends — 2.2x coverage (a 45% payout ratio).
UNH'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 PFE if earnings weaken.
Which fits an early-retirement income portfolio better, PFE or UNH?
For income you need right now, Pfizer Inc (PFE) leads: $100,000 invested today pays about $519 a month at the current 6.23% yield, versus $266 a month from Unitedhealth Group Inc (UNH) at 3.20%.
With a decade or more before the income is needed, UNH's faster dividend growth (11.7% vs 10.1% a year) matters more than the starting yield — raises compound into the larger paycheck over time.
On consistency: UNH has raised its dividend 16 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 $2,987/yr in PFE vs $1,328/yr in UNH 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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