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

by Avi Kapoor Benzinga Staff Writer

Zinger Key Points

A more conservative goal of $100 monthly dividend income would require 500 shares of General Mills.
An investor would need to own $152,350 worth of General Mills to generate a monthly dividend income of $500.
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General Mills, Inc. GIS will release its third-quarter financial results, before the opening bell, on Wednesday, March 19.

Analysts expect the company to report quarterly earnings at 96 cents per share, down from $1.17 per share in the year-ago period. General Mills projects quarterly revenue of $4.95 billion, compared to $5.1 billion a year earlier, according to data from Benzinga Pro.

With the recent buzz around General Mills, some investors may be eyeing potential gains from the company's dividends, too. Currently, General Mills offers an annual dividend yield of 3.94%. That’s a quarterly dividend of 60 cents per share ($2.40 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 $152,350 or around 2,500 shares. For a more modest $100 per month or $1,200 per year, you would need $30,470 or around 500 shares.

To calculate: Divide the desired annual income ($6,000 or $1,200) by the dividend ($2.40 in this case). So, $6,000 / $2.40 = 2,500 ($500 per month), and $1,200 / $2.40 = 500 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.

Price Action: Shares of General Mills gained 2.3% to close at $60.94 on Monday.