Until then, some Lennar investors may be eyeing potential gains from the company’s dividends. As of now, the company has an annual dividend yield of 2.07%, with a quarterly dividend of 50 cents per share ($2.00 per year).
So, how can investors exploit its dividend yield to pocket a regular $500 monthly?
To earn $500 per month or $6,000 annually from dividends alone, you would need an investment of approximately $289,710 or around 3,000 shares. For a more modest $100 per month or $1,200 per year, you would need $57,942 or around 600 shares.
To calculate: Divide the desired annual income ($6,000 or $1,200) by the dividend ($2.00 in this case). So, $6,000 / $2.00 = 3,000 ($500 per month), and $1,200 / $2.00 = 600 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: Compute the dividend yield 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 dividend payments can affect 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.
LEN Price Action: Shares of Lennar fell 2.2% to close at $96.57 on Wednesday.
On March 12, analysts expect the construction company to report quarterly earnings of 95 cents per share. That’s down from $2.14 per share in the year-ago period. The consensus estimate for Lennar’s quarterly revenue is $6.9 billion (it reported $7.63 billion last year), according to Benzinga Pro.
Ahead of quarterly earnings, Truist Securities analyst Jonathan Bettenhausen, on March 4, initiated coverage on Lennar. He also has a Hold rating and a $10 price target.
Photo via Shutterstock
Recent Comments