Dividend Per Share (DPS) (2024)

FAQs

What is the dividend per share of DPS? ›

The dividend per share (DPS) is a financial metric that measures the annual dividend issuance of a company on a per-share basis. In corporate finance, dividends are defined as the distribution of a company's after-tax earnings (i.e. net income) to common and preferred shareholders as a form of shareholder compensation.

The dividend per share would simply be the total dividend divided by the shares outstanding. In this case, it is $500,000 / 1,000,000 = $0.50 dividend per share.

Using DPS. Dividends per share is often used to estimate a stock's dividend yield, calculated as DPS divided by the stock price. The higher the dividend yield, the more profits a company pays out to shareholders on a relative basis.

The dividend yield is calculated by dividing the annual dividend per share (DPS) by the current market share price and expressed as a percentage.

What Is a Good Dividend Yield? Yields from 2% to 6% are generally considered to be a good dividend yield, but there are plenty of factors to consider when deciding if a stock's yield makes it a good investment. Your own investment goals should also play a big role in deciding what a good dividend yield is for you.

The formula used to calculate the Dividend Yield is: Dividend Yield = (Annual Dividend Payment / Current Market Price of the Stock) * 100.

In a market that generates a 2% annual yield, you would need to invest $600,000 up front in order to reliably generate $12,000 per year (or $1,000 per month) in dividend payments.

To calculate the dividend payout ratio, the formula divides the dividend amount distributed in the period by the net income in the same period. For example, if a company issued $20 million in dividends in the current period with $100 million in net income, the payout ratio would be 20%.

Dividend per share (DPS) is the sum of declared dividends issued by a company for every ordinary share outstanding. DPS is calculated by dividing the total dividends paid out by a business, including interim dividends, over a period of time, usually a year, by the number of outstanding ordinary shares issued.

How do you calculate DPS? ›

The formula for calculating DPS is dividing the total amount of dividends paid by the company to its shareholders by the total number of outstanding shares.

Dividend per share (DPS) refers to the portion of earnings allocated to shareholders. The board makes the decision based on the EPS. It is computed by dividing the total dividend by the number of outstanding shares.

DPS is useful for estimating how much money each individual shareholder will receive in dividends over a given period, while dividend yield helps compare different securities as it tells you how much of a return you can expect from each dollar invested.

Dividing the stock's annual dividend amount by its current share price allows you to calculate a stock's dividend yield. For example, if a stock is trading at $50 per share, and the company pays a quarterly dividend of 20 cents per share. That company's dividend would be 80 cents.

For example, suppose an investor buys $10,000 worth of a stock with a dividend yield of 4% at a rate of a $100 share price. This investor owns 100 shares that all pay a dividend of $4 per share (100 x $4 = $400 total).

The dividend per share is calculated using a simple method. To calculate DPS, divide the entire number of dividends paid by the company by the total number of shares held. The annualised dividend is the total amount of dividends given out during the year.

Dividend per share (DPS) is the sum of declared dividends issued by a company for every ordinary share outstanding. The figure is calculated by dividing the total dividends paid out by a business, including interim dividends, over a period of time, usually a year, by the number of outstanding ordinary shares issued.

The term dividends per share (DPS) refers to the total dividend a company pays out over a 12-month period, divided by the total number of outstanding shares. A company uses this calculation to share profits with its shareholders.

Dividend Yield = Dividends Per Share / Price Per Share

Let's say a public company's share price is $50, and it pays annual dividends equal to $1.50 per share. To determine the dividend yield, divide the dividend amount per share by the price per share: $1.50 / $50 = 0.03.