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

Investors in Dell Technologies Inc. (NYSE:DELL) may be eyeing potential gains from the company's dividends.

Ahead of the tech company’s first-quarter earnings release after the close on Thursday, May 28, Dell boasts an annual dividend yield of 0.83% ($2.52 a year), and a quarterly dividend amount of 63 cents per share.

So, how can investors use its dividend yield to pocket a regular $500 per month?

To earn $500 per month or $6,000 annually from dividends alone, you would need an investment of approximately $726,967 or around 2,381 shares. For a more modest $100 per month or $1,200 per year, you would need $145,332 or around 476 shares.

To Calculate

Divide the desired annual income ($6,000 or $1,200) by the dividend ($2.52 in this case). So, $6,000 / $2.52 = 2,381 ($500 per month), and $1,200 / $2.52 = 476 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 dividend payments can affect the yield. If a company increases its dividend, its yield will also increase, provided the stock price remains unchanged. Conversely, if the dividend payment decreases, so will the yield.

Price Action

Shares of Dell rose 0.1% to close at $305.32 on Wednesday.

Analysts expect the company to report quarterly earnings of $2.93 per share, up from $1.55 per share in the year-ago period. The consensus estimate for Dell's quarterly revenue is $35.71 billion (it reported $23.38 billion last year), according to Benzinga Pro.

The company has beaten analyst estimates for revenue in seven of the last 10 quarters, including the most recently reported fourth quarter.

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