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How to Calculate These Terms - Markrichard - 06-05-2014
Hi Guys,
I am looking for some information regarding calculation of "Projected Dividend Yield" and "Projected Dividend Income". Please explain how these two can be calculated as I have tried to google about it but could not find something interesting. It would be a great if you guys can help me somehow.
RE: How to Calculate These Terms - EricL - 06-05-2014
Personally, for projected dividend yield I just take the currently declared dividend rate, multiply it by four (if paid quarterly), then dividend by share price.
For projected income, I take declared dividend rate, take it times four, then multiply by my current number of shares.
For example, on the Dividend Announcement Thread, I have posted a spreadsheet where I track recently announced dividend increases.
Taking Deere (DE) for example:
Deere announced an increase in the quarterly dividend to $0.60 per share. If I owned 50 shares of Deere stock, at the current share price of $90.84, the calculations would look like this.
Projected Dividend Yield
Projected Yield = (4) X ($0.60) / ($90.84) X 100% = 2.64%
Projected Dividend Income
Income = (4) X ($0.60) X (50) = $120
RE: How to Calculate These Terms - Robandcindy2 - 06-05-2014
(06-05-2014, 08:19 AM)EricL Wrote: Personally, for projected dividend yield I just take the currently declared dividend rate, multiply it by four (if paid quarterly), then dividend by share price.
For projected income, I take declared dividend rate, take it times four, then multiply by my current number of shares.
For example, on the Dividend Announcement Thread, I have posted a spreadsheet where I track recently announced dividend increases.
Taking Deere (DE) for example:
Deere announced an increase in the quarterly dividend to $0.60 per share. If I owned 50 shares of Deere stock, at the current share price of $90.84, the calculations would look like this.
Projected Dividend Yield
Projected Yield = (4) X ($0.60) / ($90.84) X 100% = 2.64%
Projected Dividend Income
Income = (4) X ($0.60) X (50) = $120
Yes, that sounds good.
RE: How to Calculate These Terms - Markrichard - 06-06-2014
(06-05-2014, 08:19 AM)EricL Wrote: Personally, for projected dividend yield I just take the currently declared dividend rate, multiply it by four (if paid quarterly), then dividend by share price.
For projected income, I take declared dividend rate, take it times four, then multiply by my current number of shares.
For example, on the Dividend Announcement Thread, I have posted a spreadsheet where I track recently announced dividend increases.
Taking Deere (DE) for example:
Deere announced an increase in the quarterly dividend to $0.60 per share. If I owned 50 shares of Deere stock, at the current share price of $90.84, the calculations would look like this.
Projected Dividend Yield
Projected Yield = (4) X ($0.60) / ($90.84) X 100% = 2.64%
Projected Dividend Income
Income = (4) X ($0.60) X (50) = $120
Thanks EricL, This was absolutely Superb.. Many Thanks to You.
RE: How to Calculate These Terms - EricL - 06-06-2014
(06-06-2014, 04:25 AM)Markrichard Wrote:(06-05-2014, 08:19 AM)EricL Wrote: Personally, for projected dividend yield I just take the currently declared dividend rate, multiply it by four (if paid quarterly), then dividend by share price.
For projected income, I take declared dividend rate, take it times four, then multiply by my current number of shares.
For example, on the Dividend Announcement Thread, I have posted a spreadsheet where I track recently announced dividend increases.
Taking Deere (DE) for example:
Deere announced an increase in the quarterly dividend to $0.60 per share. If I owned 50 shares of Deere stock, at the current share price of $90.84, the calculations would look like this.
Projected Dividend Yield
Projected Yield = (4) X ($0.60) / ($90.84) X 100% = 2.64%
Projected Dividend Income
Income = (4) X ($0.60) X (50) = $120
Thanks EricL, This was absolutely Superb.. Many Thanks to You.
Always happy to help, you are welcome.
RE: How to Calculate These Terms - Kerim - 06-07-2014
No argument at all with Eric's answer, but thought you might be talking about projecting out a bit further into the future. I'm not sure if this is exactly what you are talking about, but for each stock that I track, I include the following on my spreadsheet (this is for Altria (MO)):
[attachment=69]
I plug an estimated dividend growth rate into the box -- I'm usually careful to choose a conservative number below the 1 and 5 year dividend growth rate -- and excel spits out the rest. The 2014 base dividend is adjusted for this year's expected raise, which again I guess conservatively.
So if the company meets or exceeds the dividend growth rate that I use, we'll get (at least) the dividend per share amounts shown and the yield on cost assuming today's share price.
I do not attempt to predict a "current yield" for some time in the future, as this will depend on the share price in the future, which is impossible to guess, let alone estimate with any precision. (Of course you could use a historical average dividend yield to reverse engineer a stock price at that yield, but the market rarely cooperates in that manner.)
To get projected income, you just multiply the future dividend amount by the number of shares (though you'd have to adjust the number of shares if you are reinvesting).