How To Earn $500 A Month From State Street Stock Ahead Of Q4 Earnings

State Street Corporation STT will release its fourth-quarter financial results, before the opening bell, on Friday, Jan. 17, 2025.

Analysts expect the Boston, Massachusetts-based company to report quarterly earnings at $2.44 per share, up from $2.04 per share in the year-ago period. State Street projects quarterly revenue of $3.34 billion, compared to $3.04 billion a year earlier, according to data from Benzinga Pro.

On Jan. 7, Truist Securities analyst David Smith initiated coverage on State Street with a Hold rating and announced a price target of $106.

With the recent buzz around State Street, some investors may be eyeing potential gains from the company's dividends too. As of now, State Street offers an annual dividend yield of 3.22%, which is a quarterly dividend amount of 76 cents per share ($3.04 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 $186,444 or around 1,974 shares. For a more modest $100 per month or $1,200 per year, you would need $37,308 or around 395 shares.

To calculate: Divide the desired annual income ($6,000 or $1,200) by the dividend ($3.04 in this case). So, $6,000 / $3.04 = 1,974 ($500 per month), and $1,200 / $3.04 = 395 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.

STT Price Action: Shares of State Street gained 0.6% to close at $94.45 on Monday.

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Photo by Steve Smith via Flickr