Looking to supplement your income with The Coca-ColaCompany (NYSE:KO) dividends? Aiming for $500 monthly? Here’s how much you need to invest.
Coca-Cola's Financial Snapshot
As of Jan 18, Coca-Cola's shares were trading at $59.70. The company, with a market cap of $258 billion experienced a 52-week range between $64.99 and $51.55.
Analyzing Coca-Cola's Dividend Payouts
During the third quarter of 2023, Coca-Cola announced a dividend of $0.46 per share, a slight increase from $0.44 in the same period of 2022. The total dividends paid from January to September 2023 were $1.38, compared to $1.32 in the previous year.
Don't Miss:
Investing in real estate just got a whole lot simpler. This Dara Khosrowshahi-backed startup will allow you to become a landlord in just 10 minutes, and you only need $100.
Investment Calculations for Desired Dividend Earnings
To consistently earn $500 per month from dividends, you’ll need to invest around $193,548 based on Coca-Cola's current dividend yield of 3.1%. This calculation is derived from dividing your annual dividend goal ($6,000) by the yield percentage. For a smaller goal of $200 monthly, the investment would be around $77,419.
Fluctuations in Dividend Yields
Let’s take a look at how dividend yield is impacted by stock price movements with a straightforward example. Consider a stock that consistently pays an annual dividend of $4. Initially, the stock is priced at $100, resulting in a dividend yield of 4% (calculated as $4 divided by $100). If the stock price rises to $120, while the dividend stays at $4, the yield reduces to approximately 3.33% ($4 divided by $120). On the other hand, if the stock price drops to $80, the yield would increase to 5% ($4 divided by $80). This example illustrates the inverse relationship between dividend yield and stock prices, assuming the dividend amount remains constant.
Collecting passive income from real estate just got a whole lot simpler. A new real estate fund backed by Dara Khosrowshahi gives you instant access to a diversified portfolio of rental properties, and you only need $100 to get started.
Image Credit: Shutterstock
"ACTIVE INVESTORS' SECRET WEAPON" Supercharge Your Stock Market Game with the #1 "news & everything else" trading tool: Benzinga Pro - Click here to start Your 14-Day Trial Now!
To figure out how to earn $500 monthly from Coca-Cola dividends, we start with the yearly target of $6,000 ($500 x 12 months). So, an investor would need to own approximately $194,225 worth of Coca-Cola, or 3,261 shares to generate a monthly dividend income of $500.
Shares of public companies that split profits with shareholders by paying cash dividends yield between 2% and 6% a year. With that in mind, putting $250,000 into low-yielding dividend stocks or $83,333 into high-yielding shares will get your $500 a month.
The Coca-Cola Company's ( KO ) dividend yield is 3.12%, which means that for every $100 invested in the company's stock, investors would receive $3.12 in dividends per year. The Coca-Cola Company's payout ratio is 73.72% which means that 73.72% of the company's earnings are paid out as dividends.
You would have more than doubled your money, with a total investment worth of $2,029.55. That's a 103% return, or a 7.23% annual rate of return. Interestingly, despite co*ke's dominance on the world stage, investing in co*ke's main rival, Pepsi, 10 years ago would have given you more pop for your buck.
The long-term outlook is highly positive for co*ke's cash trends, and so investors can count on further steady dividend growth over the coming years (and decades).
However, this isn't always the case. If you're looking to generate $300 in super safe monthly dividend income (note the emphasis on "monthly" income), simply invest $43,000, split equally, into the following two ultra-high-yield stocks, which sport an average yield of 8.39%!
The truth is that most investors won't have the money to generate $1,000 per month in dividends; not at first, anyway. Even if you find a market-beating series of investments that average 3% annual yield, you would still need $400,000 in up-front capital to hit your targets. And that's okay.
Breaking Down Coca-Cola Co's Dividend Yield and Growth
Over the past three years, Coca-Cola Co's annual dividend growth rate was 3.90%. Extended to a five-year horizon, this rate decreased to 3.30% per year. And over the past decade, Coca-Cola Co's annual dividends per share growth rate stands at 4.70%.
The Company normally pays dividends four times a year, usually April 1, July 1, October 1 and December 15. Shareowners of record can elect to receive their dividend payments electronically or by check in the currency of their choice.
Briefly, in order to be eligible for payment of stock dividends, you must buy the stock (or already own it) at least two days before the date of record and still own the shares at the close of trading one business day before the ex-date. That's one day before the ex-dividend date.
Perhaps the largest concern that investors have about KO stock is the fact that people are simply turning away from soda and sugary drinks. Coca-Cola's most recent earnings reports prove that people are buying fewer sugary drinks and most analysts believe that trend is going to continue.
Ten years ago, at market close on March 28, 2014, Tesla's stock was trading at $14.16 per share. This means that $10,000 invested in Tesla in March 2014 would be worth about $124,145 today. This means that if you had invested $120,954.87 in Tesla stock in 2014, you may have been able to sell it today and retire.
Coca-Cola (KO 0.28%) is often considered a safe blue chip stock. It owns the world's top soda brand, it generates plenty of cash, and it pays consistent dividends.
That's right; you save over $30,000 if you want to create $400 per month in passive income. Furthermore, this could be cash set aside in your TFSA, meaning it would be all tax free, with plenty left over for other investments.
This broader mix of stocks offers higher payouts and greater diversification than what you'll get with the Invesco QQQ Trust. And if you've got a large portfolio totaling more than $1.1 million, your dividend income could come in around $50,000 per year.
While many dividend-paying stocks dish out cash to shareholders on a quarterly basis, companies that pay monthly dividends can be found among real estate investment trusts (REITs) and business development companies (BDCs).
Hobby: Web surfing, Rafting, Dowsing, Stand-up comedy, Ghost hunting, Swimming, Amateur radio
Introduction: My name is Virgilio Hermann JD, I am a fine, gifted, beautiful, encouraging, kind, talented, zealous person who loves writing and wants to share my knowledge and understanding with you.
We notice you're using an ad blocker
Without advertising income, we can't keep making this site awesome for you.