How To Earn $1,000 Per Month From UPS Stock
United Parcel Service Inc. (NYSE:UPS) stock closed at $147.45 at the end of trading on February 12. The stock price for the trailing 52 weeks ranged from a high of $197.80 to a low of $133.68.
UPS currently pays a quarterly dividend of $1.63 per share, equating to $6.52 per share annually and giving its stock a yield of approximately 4.42% based on its closing price on February 12.
How Can You Earn $1,000 Per Month As A UPS Investor?
If you want to generate earnings of $1,000 per month — $12,000 annually — from United Parcel Service dividends, you would invest an estimated $271,493, which is about 1,841 shares at $147.45 each. If you reduce your earnings target to $200 per month, your investment drops to approximately $54,299 for 368 shares.
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Using dividend yields for calculating the estimated value of investments: You can use two parameters to determine the estimated value of your investments. One is your desired annual income of $12,000 or $2,400, and the second is the dividend yield of the stock, which is 3.98% in this case). So, $12,000 / 0.0442 = $271,493 to generate earnings of $1,000 per month, and $2,400 / 0.0442 = $54,299 for $200 per month.
To estimate a stock's dividend yield, divide its annual payouts by its price. The dividend yield may change because of fluctuations in the stock price and changes to the company's dividend policies. Assuming the stock price remains the same, there is a positive correlation between the yield and the payouts, and the yield will rise when the company increases its payout and vice versa.
Assume a stock that pays $2 as an annual dividend is priced at $50. Its dividend yield would be $2 / $50 = 4%. If the stock price rises to $60, the dividend yield drops to 3.33% ($2 / $60). A drop in stock price to $40 will have an inverse effect and increase the dividend yield to 5% ($2 / $40).
Disclaimer: This calculation is according to the price per share at the close on February 12 using an annualized dividend. The closing price of United Parcel Service stock at the end of trading hours on February 12 was $147.45.
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