With the recent buzz around the company, some investors are eyeing potential gains from its dividends. Currently, Pfizer has an annual dividend yield of 6.53%. That’s a quarterly dividend amount of 43 cents per share ($1.72 a year).
To figure out how to earn $500 monthly from PFE, we start with the yearly target of $6,000 ($500 x 12 months).
Next, we divide this amount by Pfizer's $1.72 dividend: $6,000 / $1.72 = 3,488 shares.
So, an investor would need to own approximately $91,839 worth of Pfizer, or 3,488 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 / $1.72 = 698 shares, or $18,378 to generate a monthly dividend income of $100.
Note that dividend yield can change on a rolling basis, as 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.
PFE Price Action: Shares of Pfizer fell by 1.4% to close at $26.33 on Friday.
Ahead of quarterly earnings, Citigroup analyst Geoff Meacham, on April 29, maintained Pfizer with a Neutral and raised the price target from $26 to $27.
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