Some of the bank’s investors may be eyeing potential dividend gains. Currently, the annual dividend yield at Goldman Sachs is 1.71%, with a quarterly dividend of $4.50 per share ($18.00 per year).
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 $351,412 or around 333 shares. For a more modest $100 per month or $1,200 per year, you would need $70,704 or around 67 shares.
To calculate: Divide the desired annual income ($6,000 or $1,200) by the dividend ($18.00 in this case). So, $6,000 / $18.00 = 333 ($500 per month), and $1,200 / $18.00 = 67 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
Analysts expect the bank to report quarterly earnings of $13.95 per share, up from $10.91 per share in the year-ago period. The consensus estimate for Goldman Sachs’ quarterly revenue is $15.9 billion. It reported $14.58 billion last year, according to Benzinga Pro.
Evercore ISI Group analyst Glenn Schorr maintained an Outperform rating on Goldman Sachs on Monday and raised the price target from $950 to $1,075.
Shares of Goldman Sachs gained 3.4% to close at $1,055.29 on Monday.
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