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Editor’s Note: This article has been updated to correct inaccuracies in company location and financial comparisons.
Alphabet Inc. (NASDAQ:GOOG) (NASDAQ:GOOGL) will release its fourth-quarter financial results after the closing bell on Tuesday, Feb. 4.
Analysts expect the California-based company to report quarterly earnings at $2.13 per share, up from $1.64 per share in the year-ago period. Alphabet projects quarterly revenue of $96.65 billion, compared to $86.31 billion a year earlier, according to data from Benzinga Pro.
The company has beaten analyst estimates for revenue in seven straight quarters and topped analyst expectations for earnings per share in seven straight quarters.
With the recent buzz around Alphabet, some investors may be eyeing potential gains from the company's dividends too. At the moment, Alphabet offers an annual dividend yield of 0.39%, which is a quarterly dividend amount of 20 cents per share (80 cents a year).
To figure out how to earn $500 monthly from Alphabet, we start with the yearly target of $6,000 ($500 x 12 months).
Next, we take this amount and divide it by Alphabet's $0.80 dividend: $6,000 / $0.80 = 7,500 shares.
So, an investor would need to own approximately $1,509,225 worth of Alphabet, or 7,500 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 / $0.80 = 1,500 shares, or $301,845 to generate a monthly dividend income of $100.
Note that dividend yield can change on a rolling basis, as the dividend payment and 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.
GOOG Price Action: Shares of Alphabet fell by 1.4% to close at $201.23 on Monday.
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