How To Earn $500 A Month From Williams-Sonoma Stock Ahead Of Q1 Earnings

Williams-Sonoma, Inc. WSM will release earnings results for the first quarter, before the opening bell on Thursday, May 22.

Analysts expect the San Francisco, California-based company to report quarterly earnings at $1.76 per share, up from $1.74 per share in the year-ago period. Williams-Sonoma projects to report quarterly revenue at $1.67 billion, compared to $1.66 billion a year earlier, according to data from Benzinga Pro.

On Monday, Barclays analyst Seth Sigman upgraded the stock from Underweight to Equal-Weight and raised the price target from $131 to $166.

With the recent buzz around Williams-Sonoma, some investors may be eyeing potential gains from the company's dividends too. As of now, Williams-Sonoma offers an annual dividend yield of 1.53%. That’s a quarterly dividend amount of 66 cents per share ($2.64 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 $392,138 or around 2,273 shares. For a more modest $100 per month or $1,200 per year, you would need $78,497 or around 455 shares.

To calculate: Divide the desired annual income ($6,000 or $1,200) by the dividend ($2.64 in this case). So, $6,000 / $2.64 = 2,273 ($500 per month), and $1,200 / $2.64 = 455 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.

WSM Price Action: Shares of Williams-Sonoma fell 1% to close at $172.52 on Tuesday.

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