Is PEP or LMT a better dividend investment in 2026?

PEP currently yields 3.69% with a 6.7% 5-year dividend growth rate. LMT yields 4.00% with 5% growth. The better choice depends on your goal: LMT offers higher current income.

What is the dividend yield difference between PEP and LMT?

PEP has a forward dividend yield of 3.69% ($5.42/share annually). LMT yields 4.00% ($2.00/share annually). The yield gap is 0.31 percentage points.

Home › Compare › PEP vs LMT

PEP vs LMT: Dividend Comparison 2026

PEP yields 3.69% · LMT yields 4.00%● Live data

vsPost on X →

After 10 years · $10,000 invested · DRIP enabled

🏆 LMT wins by $6.5K in total portfolio value

INVESTMENT

TIME HORIZON10 years

PEP

PepsiCo Inc.

● Live price

3.69%

Share price

$146.80

Annual div

$5.42

5Y div CAGR

6.7%

Payout ratio

72%

After 10 yrs · $10,000 · DRIP

Portfolio value

$21.5K

Annual income

$1,034.52

Full PEP calculator →

LMT

● Live price

4.00%

Share price

$50.00

Annual div

$2.00

5Y div CAGR

Payout ratio

50%

After 10 yrs · $10,000 · DRIP

Portfolio value

$28.0K

Annual income

$899.19

Full LMT calculator →

Portfolio growth — PEP vs LMT

📍 LMT pulled ahead of the other in Year 1

Annual dividend income

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Recession Test — Did They Cut Dividends?

How each stock treated shareholders during the 3 biggest crises of the last 20 years

Crisis Period	PEP	LMT
2008–2009 GFC	— No data	— No data
2020 Q1–Q2 COVID	— No data	— No data
2022 Q4 Rate Hike	— No data	— No data

Based on dividend payment history. "Increased" = dividend grew during crisis. "Maintained" = held within 3%. "Cut" = reduced by more than 3%.

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Dividend Calendar Overlap

Combined, PEP + LMT cover 0 of 12 months — good coverage

Jan

—

Feb

—

Mar

—

Apr

—

May

—

Jun

—

Jul

—

Aug

—

Sep

—

Oct

—

Nov

—

Dec

—

PEP pays

LMT pays

Both pay

Neither

💰

Tax Bracket Optimizer

Which stock is actually better after tax? Adjust your rate to find out.

PEP

Annual income on $10K today (after 15% tax)

$313.83/yr

After 10yr DRIP, annual income (after tax)

$879.34/yr

LMT

Annual income on $10K today (after 15% tax)

$340.00/yr

After 10yr DRIP, annual income (after tax)

$764.31/yr

At 15% tax rate, PEP beats the other by $115.03/year in after-tax income after 10 years on $10,000

⚖️

Lazy Portfolio Split Optimizer

What's the optimal mix of PEP + LMT for your $10,000?

PEP: 50%LMT: 50%

100% LMT50/50100% PEP

Portfolio after 10yr

$24.8K

Annual income

$966.86/yr

Blended yield

3.90%

🏛️

Copy Congress — What Are Politicians Buying?

Senate & House STOCK Act disclosures (last 90 days)

PEP buys

LMT buys

No recent congressional trades found for PEP or LMT in the last 90 days.

STOCK Act mandates disclosure within 45 days of transaction. Data via FMP.Full tracker →

MetricPEPLMT

Forward yield	3.69%	4.00% ✓
Annual dividend / share	$5.42 ✓	$2.00
Payout ratio	72%	50% ✓
1-year div growth	7.1% ✓	5%
5-year div CAGR	6.7% ✓	5%
Portfolio after 10y	$21.5K	$28.0K ✓
Annual income after 10y	$1,034.52 ✓	$899.19
Total dividends collected	$6.6K ✓	$6.4K
Payment frequency	quarterly	quarterly
Sector	Consumer Staples	Industrials

Year-by-year: PEP vs LMT ($10,000, DRIP)

Year	PEP Portfolio	PEP Income/yr	LMT Portfolio	LMT Income/yr	Gap
1← crossover	$10,734	$393.95	$11,120	$420.00	$386.00 → LMT
2	$11,535	$436.36	$12,357	$458.31	$822.00 → LMT
3	$12,411	$483.90	$13,721	$499.76	$1.3K → LMT
4	$13,371	$537.26	$15,227	$544.58	$1.9K → LMT
5	$14,422	$597.26	$16,885	$593.02	$2.5K → LMT
6	$15,578	$664.81	$18,713	$645.34	$3.1K → LMT
7	$16,848	$740.97	$20,724	$701.81	$3.9K → LMT
8	$18,248	$826.99	$22,938	$762.73	$4.7K → LMT
9	$19,793	$924.28	$25,372	$828.41	$5.6K → LMT
10	$21,500	$1,034.52	$28,047	$899.19	$6.5K → LMT

PEP vs LMT: Complete Analysis 2026

PEP — Consumer Staples

PepsiCo is a Dividend King with 52+ consecutive years of increases. Its diversified portfolio spans beverages and snacks via brands including Pepsi, Gatorade, Lay's, and Quaker. Snack food exposure provides more stable volumes than pure beverages. International expansion in emerging markets drives long-term growth.

Full PEP Calculator →

LMT — Industrials

LMT is a dividend-paying stock. Use this calculator to estimate your future dividend income, DRIP compounding returns, and passive income potential from investing in LMT shares.

Full LMT Calculator →

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⚠️ Educational purposes only. Not financial advice. Congressional trades sourced from SEC STOCK Act filings via FMP. Past performance does not guarantee future results.