SYY vs TGT: Dividend Yield, Growth & Safety Comparison
Sysco Corp (SYY) and Target Corp (TGT) are both in the Consumer Staples sector, making them natural rivals for dividend investors. TGT offers a significantly higher 4.01% yield compared to SYY's 2.43%, a gap of 1.58%. For dividend growth, SYY leads with a 5-year CAGR of 10.9% versus TGT's 9.4%. Both stocks carry a "Safe" dividend safety rating. TGT is a Dividend Aristocrat with 42 years of consecutive increases.
Key Metrics Comparison
| Metric | SYY | TGT |
|---|
| Dividend Yield | 2.43% | 4.01% |
| Annual Dividend | $2.13 | $4.50 |
| 5-Year CAGR | 10.9% | 9.4% |
| Payout Ratio | 57% | 55% |
| Consecutive Years | 0 | 42 |
| Price | $90.70 | $115.49 |
Yield Comparison
Target Corp (TGT) currently yields 4.01%, which is attractive for the broader market. That's 1.58% more than Sysco Corp (SYY), which yields 2.43%. In dollar terms, TGT pays $4.50/share annually versus SYY's $2.13/share.
Dividend Growth
Over the past five years, SYY has grown its dividend at a 10.9% CAGR compared to TGT's 9.4%. SYY: Dividend growth is accelerating — the 3-year CAGR of 18.7% exceeds the 5-year rate of 10.9% and the 10-year rate of 9.5%. TGT: Dividend growth is slowing — the 3-year CAGR of 1.8% trails the 5-year rate of 9.4% and the 10-year rate of 11.1%.
Dividend Safety
SYY's dividend safety is rated "Safe." The payout ratio of 57% is well within sustainable levels, leaving room for future increases. Earnings cover the dividend 1.7x. TGT's dividend safety is rated "Safe." The payout ratio of 55% is well within sustainable levels, leaving room for future increases. Earnings cover the dividend 1.8x. Both have similar payout ratios — SYY at 57% and TGT at 55%.
Income Comparison
A $10,000 investment in TGT generates approximately $401/year in dividend income, compared to $243/year from SYY — a difference of $158/year. At $100,000, that gap widens to $1580/year.
Verdict
- Best for income: TGT
- Best for growth: SYY
Frequently Asked Questions
Which has a higher dividend yield, SYY or TGT?
Target Corp (TGT) has a higher dividend yield of 4.01% compared to Sysco Corp (SYY) at 2.43%.
Is SYY or TGT a better dividend growth stock?
Sysco Corp has the stronger dividend growth with a 5-year CAGR of 10.9%, compared to Target Corp's 9.4%.
Which is safer for dividend income, SYY or TGT?
Sysco Corp's dividend safety is rated "Safe" while Target Corp is rated "Safe." The payout ratio of 57% is well within sustainable levels, leaving room for future increases. Earnings cover the dividend 1.7x. The payout ratio of 55% is well within sustainable levels, leaving room for future increases. Earnings cover the dividend 1.8x.
How much income does $10,000 in SYY vs TGT generate?
A $10,000 investment in SYY generates approximately $243/year in dividends, while the same amount in TGT generates about $401/year.
Is SYY or TGT a Dividend Aristocrat?
Target Corp is a Dividend Aristocrat with 42 consecutive years of increases. Sysco Corp does not currently qualify for aristocrat status.
Which has a lower payout ratio, SYY or TGT?
Target Corp has a lower payout ratio of 55% compared to Sysco Corp's 57%. A lower payout ratio generally indicates more room for dividend growth and better sustainability.
SYY vs TGT: which is better for retirement income?
It depends on your priorities. TGT for current income, SYY for dividend growth. Many retirement investors hold both for diversification.
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