Seagate Technology: A Dividend Powerhouse Ahead of Q2 Earnings
Earnings Expectations
Seagate Technology Holdings plc (NASDAQ:STX) is set to release its second-quarter financial results on Tuesday, January 21, 2025, after the market closes. Analysts anticipate a significant surge in quarterly earnings, with estimates pegged at $1.88 per share, a substantial increase from the 12 cents per share reported in the same period last year. The company is also expected to post quarterly revenue of $2.32 billion, a notable jump from $1.55 billion in the previous year.
Analyst Insights
Wells Fargo analyst Aaron Rakers recently maintained Seagate’s Equal-Weight rating, while lowering the price target from $120 to $110. This move has sparked interest among investors, who are now eyeing potential gains from the company’s dividend payouts.
Unlocking Dividend Potential
Seagate currently offers an attractive annual dividend yield of 2.95%, translating to a quarterly dividend amount of 72 cents per share ($2.88 per year). But how can investors capitalize on this dividend yield to generate a regular income stream?
Calculating Dividend Income
To earn $500 per month or $6,000 annually from dividends alone, you would need an investment of approximately $203,447 or around 2,083 shares. For a more modest $100 per month or $1,200 per year, you would need $40,728 or around 417 shares. The calculation is simple: divide the desired annual income by the dividend amount.
Understanding Dividend Yield
It’s essential to note that dividend yield can fluctuate over time, influenced by changes in the dividend payment and stock price. The dividend yield is calculated by dividing the annual dividend payment by the stock’s current price. For instance, if a stock pays an annual dividend of $2 and is currently priced at $50, the dividend yield would be 4%. However, if the stock price increases to $60, the dividend yield drops to 3.33%. Conversely, if the stock price falls to $40, the dividend yield rises to 5%.
STX Price Action
Shares of Seagate gained 2.7% to close at $97.67 on Friday, ahead of its upcoming earnings release. As investors await the company’s Q2 results, they may want to consider the potential benefits of Seagate’s dividend yield.
Transform Your Trading
Stay ahead in today’s competitive market with Benzinga Edge’s unique market trade ideas and tools. Click now to access insights that can help you make informed investment decisions. Get the latest stock analysis from Benzinga?
Leave a Reply