Costco Wholesale Corp (NASDAQ:COST) will release its fourth-quarter earnings report after the closing bell on Thursday, Sept. 24.
Analysts expect the company to report quarterly earnings of $6.53 per share, up from $5.87 per share in the year-ago period. The consensus estimate for COST’s quarterly revenue is $94.82 billion. It reported $86.16 billion last year, according to Benzinga Pro.
The company has beaten analyst estimates for revenue in six straight quarters and in seven of the past 10 quarters overall.
With the recent buzz around Costco, some investors may be eyeing potential gains from the company’s dividends too. As of now, Costco has an annual dividend yield of 0.65%, which is a quarterly dividend amount of $1.47 per share ($5.88 a year).
So, how can investors leverage 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 $922,794 or around 1,020 shares. For a more modest $100 per month or $1,200 per year, you would need $184,559 or around 204 shares.
To calculate: Divide the desired annual income ($6,000 or $1,200) by the dividend ($5.88 in this case). So, $6,000 / $5.88 = 1,020 ($500 per month), and $1,200 / $5.88 = 204 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.
COST Price Action: Shares of Costco gained 0.6% to close at $904.70 on Wednesday.
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