Benzinga - by Lisa Levin, Benzinga Editor.
Procter & Gamble Co (NYSE: PG) on Wednesday reported better-than-expected earnings for its third quarter.
Procter & Gamble reported first-quarter FY24 sales growth of 6.1% year-over-year to $21.87 billion, beating the consensus of $21.67 billion. Adjusted EPS of $1.83 (+17% Y/Y) beat the consensus of $1.71.
With Procter & Gamble reporting upbeat quarterly earnings, some investors may be eyeing potential gains from the company’s dividends. As of now, Procter & Gamble has a dividend yield of 2.51%, which is a quarterly dividend amount of $0.94 a share ($3.76 a year).
To figure out how to earn $500 monthly from Procter & Gamble dividends, we start with the yearly target of $6,000 ($500 x 12 months).
Next, we take this amount and divide it by Procter & Gamble $3.763 dividend: $6,000 / $3.763 = 1,594 shares
So, an investor would need to own approximately $239,148 worth of Procter & Gamble, or 6,000 shares to generate a monthly dividend income of $500.
Assuming a more conservative goal of $100 monthly ($1,200 annually), we do the same calculation: $1,200 / 3.763 = 319 shares, or $47,860 to generate a monthly dividend income of $100.
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Note that dividend yield can change on a rolling basis, as the dividend payment and the stock price both fluctuate over time.
The dividend yield is calculated by dividing the annual dividend payment by the current stock price. As the stock price changes, the dividend yield will also change.
For example, if a stock pays an annual dividend of $2 and its current price is $50, its dividend yield would be 4%. However, if the stock price increases to $60, the dividend yield would decrease to 3.33% ($2/$60).
Conversely, if the stock price decreases to $40, the dividend yield would increase to 5% ($2/$40).
Further, the dividend payment itself can also change over time, which can also impact the dividend yield. If a company increases its dividend payment, the dividend yield will increase even if the stock price remains the same. Similarly, if a company decreases its dividend payment, the dividend yield will decrease.
PG Price Action: Shares of Procter & Gamble gained 2.6% to close at $150.03 on Wednesday.
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