SWK vs UNP: Dividend Yield, Growth & Safety Comparison
Stanley Black & Decker, Inc. (SWK) and Union Pacific Corp (UNP) are both in the Industrials sector, making them natural rivals for dividend investors. SWK offers a significantly higher 3.60% yield compared to UNP's 2.08%, a gap of 1.51%. For dividend growth, UNP leads with a 5-year CAGR of 6.1% versus SWK's 2.6%. Both stocks carry a "Safe" dividend safety rating. SWK is a Dividend Aristocrat while UNP is a Dividend Contender.
Key Metrics Comparison
| Metric | SWK | UNP |
|---|
| Dividend Yield | 3.60% | 2.08% |
| Annual Dividend | $3.30 | $5.44 |
| 5-Year CAGR | 2.6% | 6.1% |
| Payout Ratio | 1% | 45% |
| Consecutive Years | 28 | 19 |
| Price | $91.08 | $260.92 |
Yield Comparison
Stanley Black & Decker, Inc. (SWK) currently yields 3.60%, which is solid for the broader market. That's 1.51% more than Union Pacific Corp (UNP), which yields 2.08%. In dollar terms, SWK pays $3.30/share annually versus UNP's $5.44/share.
Dividend Growth
Over the past five years, UNP has grown its dividend at a 6.1% CAGR compared to SWK's 2.6%. SWK: Dividend growth is slowing — the 3-year CAGR of 1.2% trails the 5-year rate of 2.6% and the 10-year rate of 4.3%. UNP: Dividend growth is slowing — the 3-year CAGR of 2.3% trails the 5-year rate of 6.1% and the 10-year rate of 10.3%.
Dividend Safety
SWK's dividend safety is rated "Safe." The payout ratio of 1% is well within sustainable levels, leaving room for future increases. Earnings cover the dividend 0.8x. UNP'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. SWK's payout ratio of 1% is more conservative than UNP's 45%, suggesting more room for future increases.
Income Comparison
A $10,000 investment in SWK generates approximately $360/year in dividend income, compared to $208/year from UNP — a difference of $152/year. At $100,000, that gap widens to $1520/year.
Verdict
- Best for income: SWK
- Best for growth: UNP
- Best for safety: SWK
Frequently Asked Questions
Which has a higher dividend yield, SWK or UNP?
Stanley Black & Decker, Inc. (SWK) has a higher dividend yield of 3.60% compared to Union Pacific Corp (UNP) at 2.08%.
Is SWK or UNP a better dividend growth stock?
Union Pacific Corp has the stronger dividend growth with a 5-year CAGR of 6.1%, compared to Stanley Black & Decker, Inc.'s 2.6%.
Which is safer for dividend income, SWK or UNP?
Stanley Black & Decker, Inc.'s dividend safety is rated "Safe" while Union Pacific Corp is rated "Safe." The payout ratio of 1% is well within sustainable levels, leaving room for future increases. Earnings cover the dividend 0.8x. 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 SWK vs UNP generate?
A $10,000 investment in SWK generates approximately $360/year in dividends, while the same amount in UNP generates about $208/year.
Is SWK or UNP a Dividend Aristocrat?
Stanley Black & Decker, Inc. is a Dividend Aristocrat (28 years) and Union Pacific Corp is a Dividend Contender (19 years).
Which has a lower payout ratio, SWK or UNP?
Stanley Black & Decker, Inc. has a lower payout ratio of 1% compared to Union Pacific Corp's 45%. A lower payout ratio generally indicates more room for dividend growth and better sustainability.
SWK vs UNP: which is better for retirement income?
It depends on your priorities. SWK for current income, UNP for dividend growth, SWK for safety. Many retirement investors hold both for diversification.
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