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How General Electric’s Dividend Yield Compares to Peers

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Feb. 13 2018, Updated 11:05 a.m. ET

GE’s forward dividend yield

The forward dividend yield is calculated by dividing a year’s worth of expected future dividend payments by the present stock price. Once upon a time, General Electric (GE) was a dividend aristocrat. Investors seeking regular income used to look to the company for its excellent dividend track record. GE had a history of steady growth in quarterly cash dividends.

In the last few months, General Electric’s forward dividend yield has fallen. In September 2017, its yield was around 4%. However, the yield is now at 3.2%. As the above chart shows, GE still leads the peer group in terms of forward dividend yield. The company’s dividend yield was 45% higher than the other big industrial peer average of 2.2%.

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Peer group’s forward dividend yield

General Electric is followed by Koninklijke Philips (PHG) with a forward dividend yield of 2.5%. PHG is a Netherlands-headquartered company offering technology solutions to the healthcare industry. Industrial technology solutions provider 3M Company (MMM) ranks next to PHG with a forward dividend yield of 2.3%.

United Technologies (UTX) comes after 3M Company with a yield of 2.3%. The company provides high-end industrial technology solutions in the US. Illinois Tool Works (ITW) is an industrial product and equipment manufacturer, and its dividend yield is 2.1%. Honeywell International (HON) has a forward dividend yield of 2.0%. Boeing (BA), which replaced General Electric as the largest manufacturer in the US by market capitalization, has a yield of 2.0%. Parker-Hannifin (PH), a manufacturer of motion and control technologies and systems for the industrial sector, has a yield of 1.5%.

General Electric makes up 3.9% of the iShares US Industrials ETF (IYJ). Other major industrial companies in IYJ include Boeing with a 5.7% weight, 3M Company with a 4.1% weight, and Honeywell International with a 3.4% weight.

In the last article of this series, we’ll compare GE’s returns with those of its peers.

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