Benzinga - by Priya Nigam, Benzinga Staff Writer.
McCormick & Company, Incorporated (NYSE: MKC) on Tuesday reported weaker-than-expected sales for its third quarter.
The company posted third-quarter FY23 sales growth of 6% year-on-year to $1.684 billion, missing the analyst consensus estimate of $1.70 billion. Adjusted EPS of $0.65 was in line with the consensus estimate.
McCormick reaffirmed FY23 revenue growth guidance of 5%-7%. The company raised FY23 adjusted EPS outlook to $2.62-$2.67 from $2.60-$2.65.
With the buzz around McCormick following quarterly results, some investors may be eyeing potential gains from the company’s dividends. As of now, McCormick offers an annual dividend yield of 2.28%, which is a quarterly dividend amount of 39 cents per share ($1.56 a year).
So, how can investors exploit its dividend yield to pocket a regular $500 monthly?
To earn $500 per month or $6,000 annually from dividends alone, you would need an investment of approximately $263,066 or around 3,846 shares. For a more modest $100 per month or $1,200 per year, you would need $52,600 or around 769 shares.
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To calculate: Divide the desired annual income ($6,000 or $1,200) by the dividend (1.56 in this case). So, $6,000 / 1.56= 3,846 ($500 per month), and $1,200 / 1.56= 769 shares ($100 per month).
Note that dividend yield can change on a rolling basis, as the dividend payment and the stock price both fluctuate over time.
How that works: The dividend yield is computed by dividing the annual dividend payment by the stock's current price.
For example, if a stock pays an annual dividend of $2 and is currently priced at $50, the dividend yield would be 4% ($2/$50). However, if the stock price increases to $60, the dividend yield drops to 3.33% ($2/$60). Conversely, if the stock price falls to $40, the dividend yield rises to 5% ($2/$40).
Similarly, changes in the dividend payment can impact the yield. If a company increases its dividend, the yield will also increase, provided the stock price stays the same. Conversely, if the dividend payment decreases, so will the yield.
MKC Price Action: Shares of McCormick fell 8.5% to close at $68.40 on Tuesday.
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