How To Earn $500 A Month From Dell Stock Ahead Of Q3 Earnings

Dell Technologies Inc. DELL will release earnings results for the third quarter, after the closing bell, on Tuesday.

Analysts expect the Round Rock, Texas-based company to report quarterly earnings at $2.06 per share, up from $1.88 per share in the year-ago period. Dell is expected to report quarterly revenue of $24.72 billion, compared to $22.25 billion a year earlier, according to data from Benzinga Pro.

Last week, Dell announced an expansion of its Dell Integrated Rack Scalable Systems (IRSS) program to include the Dell PowerEdge XE9685L and Dell PowerEdge XE7740 servers in the standard 19-inch Dell Integrated Rack 5000. The new liquid and air-cooled Dell PowerEdge XE servers deliver advanced compute at scale and simplify data access for AI.

With the recent buzz around Dell ahead of quarterly earnings, some investors may be eyeing potential gains from the company's dividends too. As of now, Dell offers an annual dividend yield of 1.23%, which is a quarterly dividend amount of 44.5 cents per share ($1.78 a year).

To figure out how to earn $500 monthly from Dell, we start with a yearly target of $6,000 ($500 x 12 months).

Next, we take this amount and divide it by Dell's $1.78 dividend: $6,000 / $1.78 = 3,371 shares.

So, an investor would need to own approximately $485,963 worth of Dell, or 3,371 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 / $1.78 = 674 shares, or $97,164 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.

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.

DELL Price Action: Shares of Dell slipped by 0.03% to close at $144.16 on Monday.

Read More:

• Jim Cramer Says This Stock Is A Bitcoin Play And He Prefers To Own Bitcoin

Photo: Shutterstock