News

How To Earn $500 A Month From Broadcom Stock Ahead Of Q4 Earnings

How To Earn $500 A Month From Broadcom Stock Ahead Of Q4 Earnings

Analysts expect Broadcom Inc . (NASDAQ: AVGO ) to report fourth quarter earnings at $1.39 per share after the closing bell on Thursday, Dec. 12 . That would be up from $1.11 per share in the year-ago period.

The Palo Alto, California-based company also projects quarterly revenue of $14.06 billion, compared to $9.29 billion a year earlier.

With the recent buzz around Broadcom, some investors may be eyeing potential gains from the company's dividends. As of now, Broadcom offers an annual dividend yield of 1.16%, which is a quarterly dividend amount of 53 cents per share ($2.12 a 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 $518,456 or around 2,830 shares. For a more modest $100 per month or $1,200 per year, you would need $103,691 or around 566 shares.

To calculate: Divide the desired annual income ($6,000 or $1,200) by the dividend ($2.12 in this case). So, $6,000 / $2.12 = 2,830 ($500 per month), and $1,200 / $2.12 = 566 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.

View more earnings on AAPL

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.

Price Action: Shares of Broadcom gained 6.6% to close at $183.20 on Wednesday following a report indicating the company is working with Apple Inc (NASDAQ: AAPL ) on AI chip development.


Read More:

Image: Shutterstock

Up Next: Transform your trading with Benzinga Edge's one-of-a-kind market trade ideas and tools. Click now to access unique insights that can set you ahead in today's competitive market.

Get the latest stock analysis from Benzinga?

This article How To Earn $500 A Month From Broadcom Stock Ahead Of Q4 Earnings originally appeared on Benzinga.com

© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.