How To Earn $500 A Month From Goldman Sachs Stock Ahead Of Q1 Earnings

Goldman Sachs Group, Inc. GS will release earnings results for the first quarter, before the opening bell on Monday, April 14.

Analysts expect the bank to report quarterly earnings at $12.35 per share, up from $11.58 per share in the year-ago period. Goldman Sachs projects to report quarterly revenue at $14.81 billion, compared to $14.21 billion a year earlier, according to data from Benzinga Pro.

On Tuesday, JMP Securities analyst Devin Ryan maintained Goldman Sachs with a Market Outperform rating and lowered the price target from $625 to $600.

With the recent buzz around Goldman Sachs, some investors may be eyeing potential gains from the company's dividends too. Currently, Goldman Sachs offers an annual dividend yield of 2.45%. That’s a quarterly dividend of $3.00 per share ($12.00 annually).  

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 $244,900 or around 500 shares. For a more modest $100 per month or $1,200 per year, you would need $48,980 or around 100 shares.

To calculate: Divide the desired annual income ($6,000 or $1,200) by the dividend ($12.00 in this case). So, $6,000 / $12.00 = 500 ($500 per month), and $1,200 / $12.00 = 100 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.

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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.

GS Price Action: Shares of Goldman Sachs fell 5.2% to close at $489.80 on Thursday.

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