Apple Inc (NASDAQ:AAPL) will release earnings results for its third quarter after the closing bell on Thursday, Aug. 1.
Meanwhile, some investors are eyeing potential gains from the company’s dividends.
The Cupertino, California-based company currently has a dividend yield of 0.45%, which is a quarterly dividend amount of 25 cents a share ($1.00 a year).
To figure out how to earn $500 monthly from Apple, we start with a yearly target of $6,000 ($500 x 12 months).
Next, we take this amount and divide it by Apple’s $1.00 dividend: $6,000 / $1.00 = 6,000 shares
So, an investor would need to own approximately $1,332,480 worth of Apple, 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 / $1.00 = 1,200 shares, or $266,496 to generate a monthly dividend income of $100.
Note that dividend yield can change on a rolling basis, as the dividend payment and the stock price both fluctuate over time.
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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.
AAPL Price Action: Shares of Apple rose 1.5% to close at $222.08 on Wednesday.
Analysts expect Apple to report quarterly earnings at $1.35 per share, up from $1.18 per share in the year-ago period. The company is projected to post revenue of $84.53 billion, compared to $76.41 billion a year earlier.
On Thursday, analysts will also be looking at Apple’s streaming results and its ability to balance ad-free plans with ad-supported plans. Apple is one of the newer companies in the streaming space and could soon be launching an ad-supported plan.
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This article How To Earn $500 A Month From Apple Stock Ahead Of Q3 Earnings originally appeared on Benzinga.com
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