Some investors may be eyeing potential gains from the Minneapolis-based company's dividends. Target currently offers an annual dividend yield of 2.86%. That’s a quarterly dividend amount of $1.12 per share ($4.48 a year).
To figure out how to earn $500 monthly from Target, we start with the yearly target of $6,000 ($500 x 12 months). Next, we take this amount and divide it by Target's $4.48 dividend: $6,000 / $4.48 = 1,339 shares.
So, an investor would need to own approximately $209,634 worth of Target, or 1,339 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 / $4.48 = 268 shares, or $41,958 to generate a monthly dividend income of $100.
The dividend yield can change on a rolling basis; 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.
Price Action: Target shares gained by 2.9% to close at $156.56 on Monday.
Analysts expect Target to report quarterly earnings at $2.30 per share. That’s up from $2.10 per share a year ago. The retailer projects to report quarterly revenue of $25.9 billion, compared to $25.4 billion a year earlier, according to data from Benzinga Pro.
On Nov. 13, Telsey Advisory Group analyst Joseph Feldman maintained Target with an Outperform rating and maintained a $195 price target.
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