CAT vs LMT: Which Is the Better Dividend Stock?
As of September 2026, CAT (Caterpillar Inc.) screens as the stronger dividend stock, winning 5 of 8 head-to-head metrics. LMT offers the higher yield at 2.63%, CAT has the higher dividend-safety score, and LMT trades at the larger discount to fair value (+13%).
| Metric | CAT | LMT |
|---|---|---|
| Forward yield | 0.80% | 2.63% |
| Annual dividend | $6.52 | $13.80 |
| Payout ratio | 26% | 50% |
| Years of growth | 32 yr | 23 yr |
| 5-yr dividend growth | 7.2% | 6.4% |
| 5-yr total return | 326% | 52% |
| Dividend safety score | 92 (A) | 89 (A) |
| Fair value estimate | $493.16 | $590.16 |
| Upside to fair value | -40% | +13% |
| Frequency | quarterly | quarterly |
| Market cap | $376.3B | $121.0B |
| P/E ratio | 35.2 | 19.3 |
Higher yield
LMT
2.63%
Safer dividend
CAT
Grade A
Faster growth
CAT
7.2%
Better value
LMT
+13% upside
CAT vs LMT — FAQ
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