Dividend Yield Calculator

Calculate annual dividend yield percentage, dividend income, and compare dividend investments. Essential for income investors.

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Quick Facts

Dividend Aristocrats
25+ Years
Consecutive dividend increases
S&P 500 Avg Yield
~1.5%
Current average dividend yield
High Yield REITs
4-8%
Real estate investment trusts
Qualified Dividends
0-20% Tax
Lower than ordinary income

Your Results

Calculated
Dividend Yield
0%
Annual yield
Annual Dividend
$0
Per share
Total Annual Income
$0
Based on holdings

Key Takeaways

  • Dividend yield = (Annual Dividend / Stock Price) x 100
  • Higher yields may indicate value opportunity OR potential risk
  • Dividend Aristocrats have increased dividends for 25+ consecutive years
  • Qualified dividends receive favorable tax treatment (0-20% vs ordinary income rates)
  • DRIP (Dividend Reinvestment Plans) compound your returns over time

What is Dividend Yield?

Dividend yield is a financial ratio that shows how much a company pays out in dividends each year relative to its stock price. It's expressed as a percentage and helps investors evaluate the income potential of dividend-paying stocks.

For income-focused investors, dividend yield is a crucial metric for comparing the income-generating potential of different stocks. A stock with a 4% dividend yield will generate $4 in annual dividends for every $100 invested, while a 2% yield generates only $2.

The Dividend Yield Formula

Dividend Yield = (Annual Dividend Per Share / Stock Price) x 100
Annual Dividend = Total dividends paid per share in one year
Stock Price = Current market price per share

For example, if a stock pays $2.00 in annual dividends and trades at $50, its dividend yield is 4% ($2.00 / $50 x 100).

How to Use This Calculator

1

Enter the Current Stock Price

Input the current market price per share of the stock you're analyzing.

2

Select Dividend Type

Choose how the dividend is expressed (annual, quarterly, or monthly).

3

Enter the Dividend Amount

Input the dividend per share for the selected period.

4

Add Holdings (Optional)

Enter shares owned or investment amount to see projected income.

5

View Your Results

Click "Calculate" to see dividend yield and income projections.

Understanding Dividend Yield Categories

5%+
High Yield
Value opportunity or potential risk - research carefully
2-5%
Moderate Yield
Common for established dividend stocks
0-2%
Low Yield
Often growth-focused companies

Important Considerations

  • High yields may signal trouble: A very high yield might indicate a declining stock price or an unsustainable dividend that could be cut.
  • Dividend growth matters: Consider the dividend growth rate, not just current yield. A stock with a 2% yield growing at 10% annually may outperform a 5% yield with no growth.
  • Payout ratio: The percentage of earnings paid as dividends indicates sustainability. Under 60% is generally healthy.
  • Dividend Aristocrats: Companies that have increased dividends for 25+ consecutive years offer proven reliability.
  • Tax treatment: Qualified dividends receive favorable tax rates (0%, 15%, or 20% based on income).

Pro Tip: DRIP Your Dividends

Dividend Reinvestment Plans (DRIPs) automatically use your dividends to purchase more shares. This compounds your returns over time - a $10,000 investment at 4% yield with dividends reinvested can grow to over $21,000 in 20 years, assuming the stock price and dividend remain stable.

Dividend Income Strategies

  • DRIP (Dividend Reinvestment): Reinvest dividends to buy more shares and compound your returns over time.
  • Income Focus: Target stocks with reliable, high dividends for regular cash flow.
  • Dividend Growth: Focus on companies that consistently grow their dividends, even if current yield is lower.
  • Diversification: Spread investments across sectors to reduce risk from any single dividend cut.