Oracle Corporation (NYSE:ORCL) will release its third-quarter financial results, after the closing bell, on Monday, March 10.
Analysts expect the company to report quarterly earnings at $1.49 per share, up from $1.41 per share in the year-ago period. Oracle projects quarterly revenue of $14.4 billion, compared to $13.28 billion a year earlier, according to data from Benzinga Pro.
On March 5, Guggenheim analyst John Difucci reiterated Oracle with a Buy and maintained a $220 price target.
With the recent buzz around Oracle, some investors may be eyeing potential gains from the company’s dividends too. As of now, Oracle offers an annual dividend yield of 1.06%, which is a quarterly dividend amount of 40 cents per share ($1.60 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 $566,025 or around 3,750 shares. For a more modest $100 per month or $1,200 per year, you would need $113,205 or around 750 shares.
To calculate: Divide the desired annual income ($6,000 or $1,200) by the dividend ($1.60 in this case). So, $6,000 / $1.60 = 3,750 ($500 per month), and $1,200 / $1.60 = 750 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.
ORCL Price Action: Shares of Oracle dipped 6.6% to close at $150.94 on Thursday.
Read More: