An investor would need to own $219,914 worth of Hewlett Packard Enterprise to generate a monthly dividend income of $500.
Hewlett Packard Enterprise Company HPE is expected to release earnings results for its third quarter, after the closing bell on Wednesday, Sept. 4.
Analysts expect the Houston-based company to report quarterly earnings at 47 cents per share. That's down from 49 cents per share in the year-ago period. Hewlett Packard Enterprise is projected to post revenue of $7.66 billion, according to data from Benzinga Pro.
On Aug. 15, Hewlett Packard Enterprise entered into a definitive agreement to acquire Morpheus Data, a pioneer in software for hybrid cloud management and platform operations.
With the recent buzz around Hewlett Packard Enterprise, some investors may be eyeing potential gains from the company's dividends. As of now, Hewlett Packard Enterprise has a dividend yield of 2.74%. That's a quarterly dividend amount of 13 cents a share (52 cents a year).
To figure out how to earn $500 monthly from Hewlett Packard Enterprise, we start with the yearly target of $6,000 ($500 x 12 months).
Next, we take this amount and divide it by HPE's $0.52 dividend: $6,000 / $0.52 = 11,538 shares
So, an investor would need to own approximately $219,914 worth of HPE, or 11,538 shares to generate a monthly dividend income of $500.
Assuming a more conservative goal of $100 monthly ($1,200 annually), we do the same calculation: $1,200 / $0.52 = 2,308 shares, or $43,990 to generate a monthly dividend income of $100.
Note that dividend yield can change on a rolling basis, as the dividend payment and the stock price both fluctuate over time.
The dividend yield is calculated by dividing the annual dividend payment by the current stock price. As the stock price changes, the dividend yield will also change.
For example, if a stock pays an annual dividend of $2 and its current price is $50, its dividend yield would be 4%. However, if the stock price increases to $60, the dividend yield would decrease to 3.33% ($2/$60).
Conversely, if the stock price decreases to $40, the dividend yield would increase to 5% ($2/$40).
Further, the dividend payment itself can also change over time, which can also impact the dividend yield. If a company increases its dividend payment, the dividend yield will increase even if the stock price remains the same. Similarly, if a company decreases its dividend payment, the dividend yield will decrease.
HPE Price Action: Shares of Hewlett Packard Enterprise fell 1.6% to close at $19.06 on Thursday.
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