Get Ready for PepsiCo’s Q3 Earnings: A Dividend Powerhouse
On October 8, PepsiCo, Inc. (NASDAQ:PEP) is set to unveil its third-quarter earnings, and analysts are predicting a strong performance. The Purchase, New York-based giant is expected to report quarterly earnings of $2.29 per share, a slight increase from $2.25 per share in the same period last year. Revenue is projected to reach $23.82 billion, up from $23.45 billion, according to Benzinga Pro data.
But what really catches the eye is PepsiCo’s impressive dividend yield of 3.23%. This translates to a quarterly dividend payout of $1.3550 per share, or $5.42 annually. Savvy investors may be wondering how to tap into this dividend stream to generate a steady income.
To earn a monthly dividend income of $500, or $6,000 per year, you would need to invest around $185,943, equivalent to approximately 1,107 shares. For a more modest goal of $100 per month, or $1,200 per year, you would need to invest around $37,121, or about 221 shares.
The key to unlocking this dividend potential lies in understanding how the yield is calculated. It’s simply a matter of dividing the desired annual income by the dividend payment. In this case, that would be $6,000 ÷ $5.42 = 1,107 shares, or $1,200 ÷ $5.42 = 221 shares.
Keep in mind that dividend yields can fluctuate over time, influenced by changes in the dividend payment and stock price. For instance, if the stock price increases, the yield will decrease, and vice versa. Similarly, changes in the dividend payment will also impact the yield.
PepsiCo’s shares closed at $167.97 on Friday, down 0.3%, after RBC Capital analyst Nik Modi maintained a Sector Perform rating and lowered the price target from $177 to $176. Barclays analyst Lauren Lieberman also cut the price target from $187 to $186.
As investors await PepsiCo’s Q3 earnings, they may want to consider the potential of its dividend yield to generate a steady income stream. With the right investment strategy, PepsiCo’s dividend powerhouse could be the key to unlocking a regular monthly income of $500 or more.
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