How To Earn $500 A Month From Marvell Technology Stock Ahead Of Q4 Earnings

by Avi Kapoor Benzinga Staff Writer

Zinger Key Points

A more conservative goal of $100 monthly dividend income would require 5,000 shares of Marvell Technology.
An investor would need to own $2,208,250 worth of Marvell Technology to generate a monthly dividend income of $500.
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Marvell Technology, Inc. MRVL will release its fourth-quarter financial results, after the closing bell on Wednesday, March 5.

Analysts expect the company to report quarterly earnings at 59 cents per share, up from 46 cents per share in the year-ago period. Marvell Technology projects quarterly revenue of $1.80 billion, compared to $1.43 billion a year earlier, according to data from Benzinga Pro.

On Jan. 22, Keybanc analyst John Vinh maintained Marvell Tech with an Overweight and raised the price target from $125 to $135.

With the recent buzz around Marvell Technology, some investors may be eyeing potential gains from the company's dividends too. As of now, Marvell Technology offers an annual dividend yield of 0.28%, which is a quarterly dividend amount of 6 cents per share (24 cents 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 $2,208,250 or around 25,000 shares. For a more modest $100 per month or $1,200 per year, you would need $441,650 or around 5,000 shares.

To calculate: Divide the desired annual income ($6,000 or $1,200) by the dividend ($0.24 in this case). So, $6,000 / $0.24 = 25,000 ($500 per month), and $1,200 / $0.24 = 5,000 shares ($100 per month).

Note that dividend yield can change on a rolling basis, as the dividend payment and 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.

MRVL Price Action: Shares of Marvell Technology gained 2.9% to close at $88.33 on Tuesday.