TGT vs XOM: Dividend Comparison

At $115.49 per share, $10,000 buys about 86.6 shares of Target Corp (TGT). Each share pays $4.50 per year in dividends, so the position starts out generating roughly $390 per year — about $32 a month.

At $148.59 per share, $10,000 buys about 67.3 shares of Exxon Mobil Corp (XOM). Each share pays $4.00 per year in dividends, so the position starts out generating roughly $269 per year — about $22 a month.

TGT is the larger income stream from day one: $120 per year more on the same $10,000 invested.

Target Corp (TGT) has raised its dividend about 9.4% a year over the past five years. If that pace held, the $401 per year that $10,000 generates today at the current 4.01% yield would reach $982 per year by 2036 — a 9.8% yield on the original cost.

Exxon Mobil Corp (XOM) has raised its dividend about 11.2% a year over the past five years. If that pace held, the $264 per year that $10,000 generates today at the current 2.64% yield would reach $760 per year by 2036 — a 7.6% yield on the original cost.

On those trailing rates, TGT pays more in 2036: $982 versus $760 per year. The projection assumes each five-year growth rate persists and no dividends are reinvested — real payouts will differ.

Exxon Mobil Corp (XOM) yields less today (2.64% vs 4.01%) but has grown its dividend faster — 11.2% vs 9.4% a year over the past five years. If both trends continued, a $10,000 position in XOM would start out-earning the same position in TGT around 2052 (roughly 26 years from now), paying about $4,131 per year at the crossover. Before that point, TGT pays more each year; after it, the gap compounds in XOM's favor.

Target Corp (TGT) earns $8.25 per share against $4.50 paid out in dividends — 1.8x coverage (a 55% payout ratio).

Exxon Mobil Corp (XOM) earns $6.70 per share against $4.00 paid out in dividends — 1.7x coverage (a 60% payout ratio).

Coverage is similar for both, so neither dividend looks meaningfully more stretched than the other on current earnings.

For income you need right now, Target Corp (TGT) leads: $100,000 invested today pays about $335 a month at the current 4.01% yield, versus $220 a month from Exxon Mobil Corp (XOM) at 2.64%.

With a decade or more before the income is needed, XOM's faster dividend growth (11.2% vs 9.4% a year) matters more than the starting yield — raises compound into the larger paycheck over time.

On consistency: TGT has raised its dividend 42 consecutive years; XOM has raised its dividend 42 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.