In the athletic-apparel space, Nike (NYSE:NKE) and Foot Locker, (NYSE:FL) are two of the most dominant companies. Both stocks have performed extremely well during the past several years. In fact, Nike stock is up 80% in the past two years, while Foot Locker shares have soared 111% in that time.

As a result, both companies are more commonly viewed as growth stocks. But they also pay dividends, and thanks to their strong growth, can afford to raise these dividends at high rates on an annual basis.

For investors sizing up these two athletic apparel giants, here's a match-up of their respective dividend programs.

Better stock for dividends now: Foot Locker
Obviously, both Nike and Foot Locker have richly rewarded investors in recent years thanks to their excellent stock-price increases. Of course, the flip side of this coin is that, for new investors, neither stock offers a compelling dividend yield, because a stock price and dividend yield are inversely related. Nike's and Foot Locker's dividend yields are both at five-year lows.

NKE Dividend Yield (TTM) Chart

NKE Dividend Yield (TTM) data by YCharts.

For dividend income right now, Nike leaves a lot to be desired. Its dividend yield is less than 1%. Nike is one of the most well-known growth stocks around, and as such, it shouldn't be a surprise that its dividend yield is very low.

On the other hand, Foot Locker is a better choice for investors looking for current yield. Its dividend yield is a more satisfactory 1.3%. Foot Locker's dividend payout ratio stands at 26% of trailing 12-month earnings per share. Nike's payout ratio is a modest 30% of EPS.

Nike prefers to utilize a greater percentage of its cash flow for share repurchases. Nike generated $3.7 billion of free cash flow, and utilized $2.5 billion, or 67%, on stock buybacks last year, while Foot Locker used 58% of its 2014 free cash flow on stock repurchases.

Their high growth rates and low payout ratios indicate both companies stand a good chance of passing through sizable dividend increases each year going forward. Indeed, both Nike and Foot Locker are excellent dividend growth stocks.

Better stock for dividends later: Nike
Both stocks have done a great job of increasing dividends during the last several years.

NKE Dividends Paid (TTM) Chart

NKE Dividends Paid (TTM) data by YCharts.

In the past five years, Nike has increased its dividend at a 15% compound annual clip. Meanwhile, Foot Locker's five-year dividend CAGR stands at 10% per year. Foot Locker is no slouch in the dividend growth realm, but can't quite match up to Nike in this regard.

Nike's higher dividend growth is thanks to its rapid growth of revenue and profits. Nike is simply firing on all cylinders right now. In its recently concluded fiscal year, Nike's revenue grew 10% to $30 billion. Earnings per share increased 25%.

Nike saw broad-based growth across its men's and women's businesses, as well as all around the world. Last quarter, revenue excluding currency effects soared 20% in China, 19% in Japan, and 17% in Western Europe, year over year. Separately, Nike's women's business grew revenue by 20% last year, to nearly $6 billion.

Foot Locker is also growing its business. It operates more than 3,400 stores in the United States, Canada, Europe, Australia, and New Zealand. Foot Locker grew revenue and earnings per share by 10% and 25%, respectively, last year.

Earlier this year, Foot Locker raised its dividend by 14%, and approved a new three-year, $1-billion share-buyback program, to help keep earnings growth intact. This was a 67% increase from the company's previous share buyback plan.

The key takeaway is that, while both stocks can be counted on for strong growth but relatively small dividend yields, their dividend growth more than makes up for that. Of the two, Foot Locker is the better pick for investors who need income now, such as retirees, for its higher dividend yield. However, those investors with a longer time horizon should pick Nike for its higher dividend growth.

Bob Ciura has no position in any stocks mentioned. The Motley Fool recommends Nike. The Motley Fool owns shares of Nike. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.