Dividend Yield Calculator

Calculate dividend yield to measure dividend income as a percentage of stock price.

Please fill in all the fields.

What is Dividend Yield?

Dividend Yield is a financial ratio that measures the annual dividend payments relative to the stock price, expressed as a percentage.

Dividend yield is calculated by dividing the annual dividend per share by the stock price and multiplying by 100. It represents the annual dividend income an investor receives for each dollar invested in the stock.

A higher dividend yield may indicate attractive income potential, but it could also suggest that the stock price has declined or that the dividend may not be sustainable. Dividend yields vary significantly across industries and investment strategies.

Dividend yield is particularly important for income-focused investors who seek regular cash flows from their investments. It helps compare income-generating potential across different dividend-paying stocks and provides insight into the company’s dividend policy and financial health.

Dividend Yield Formula

\begin{gather*}\bold{Given{:}}\newline\begin{aligned}\text{Annual Dividend Per Share} &= \mathrm{DPS}\newline\text{Stock Price} &= \mathrm{SP}\end{aligned}\newline\bold{Calculate{:}}\newline\text{Dividend Yield} = \mathrm{DY} \newline = \frac{\mathrm{DPS}}{\mathrm{SP}} \times \mathrm{100{\%}}\end{gather*}

Dividend Yield Calculation Examples

Example 1

A stock pays annual dividends of $2.4 per share and is currently trading at $60.

Let's calculate the dividend yield for this stock:

\begin{gather*}\bold{Given{:}}\newline\begin{aligned}\text{Annual Dividend Per Share}\space(\mathrm{DPS}) &= \mathrm{{\$}2.4}\newline\text{Stock Price}\space(\mathrm{SP}) &= \mathrm{{\$}60}\end{aligned}\newline\bold{Calculate{:}}\newline\text{Dividend Yield}\space(\mathrm{DY})\newline\begin{aligned}&= \frac{\mathrm{DPS}}{\mathrm{SP}} \times \mathrm{100{\%}}\newline&= \frac{\mathrm{{\$}2.4}}{\mathrm{{\$}60}} \times \mathrm{100{\%}}\newline&= 0.04 \times \mathrm{100{\%}}\newline&= \mathrm{4{\%}}\end{aligned}\end{gather*}

This indicates that the dividend yield for the stock is 4%, meaning that investors receive 4% in annual dividend income for each dollar invested in the stock.

Example 2

A utility company's stock has an annual dividend of $1.5 per share with a current price of $30.

Let's calculate the dividend yield for this utility stock:

\begin{gather*}\bold{Given{:}}\newline\begin{aligned}\text{Annual Dividend Per Share}\space(\mathrm{DPS}) &= \mathrm{{\$}1.5}\newline\text{Stock Price}\space(\mathrm{SP}) &= \mathrm{{\$}30}\end{aligned}\newline\bold{Calculate{:}}\newline\text{Dividend Yield}\space(\mathrm{DY})\newline\begin{aligned}&= \frac{\mathrm{DPS}}{\mathrm{SP}} \times \mathrm{100{\%}}\newline&= \frac{\mathrm{{\$}1.5}}{\mathrm{{\$}30}} \times \mathrm{100{\%}}\newline&= 0.05 \times \mathrm{100{\%}}\newline&= \mathrm{5{\%}}\end{aligned}\end{gather*}

This calculation shows that the dividend yield for the utility stock is 5%, representing the annual dividend return as a percentage of the stock price.

Reference This Page

If you found our Dividend Yield Calculator valuable, please consider referencing this page in your work. You can easily cite it by using the following formatted text:

<a href="https://calculatorplanet.com/finance/dividend-yield">Dividend Yield Calculator by Calculator Planet</a>

Dividend Yield Calculator by CalculatorPlanet.com