Cigna Group (NYSE:CI) investors may be eyeing potential dividend gains ahead of the company’s third-quarter earnings report on Thursday, Nov. 5.

Currently, Cigna has an annual dividend yield of 2.11%, with a quarterly dividend of $1.56 per share ($6.24 a year).  

So, how can investors exploit its dividend yield to pocket a regular $500 monthly?

To earn $500 per month or $6,000 annually from dividends alone, you would need an investment of approximately $284,213 or around 962 shares. For a more modest $100 per month or $1,200 per year, you would need $56,724 or around 192 shares.

To Calculate

Divide the desired annual income ($6,000 or $1,200) by the dividend ($6.24 in this case). So, $6,000 / $6.24 = 962 shares ($500 per month), and $1,200 / $6.24 = 192 shares ($100 per month).

Note that dividend yield can change on a rolling basis, as dividend payments and stock prices both fluctuate over time.

How That Works

The dividend yield is computed by dividing the annual dividend payment by the stock’s current price.

For example, if a stock pays an annual dividend of $2 and trades at $50, the dividend yield is 4% ($2/$50). However, if the stock price increases to $60, the dividend yield drops to 3.33% ($2/$60). Conversely, if the stock price falls to $40, the dividend yield rises to 5% ($2/$40).

Similarly, changes in dividend payments can affect yield. If a company increases its dividend, the yield will also increase, provided the stock price stays the same. Conversely, if the dividend payment decreases, so will the yield.

CI Price Action

Cigna shares gained 0.1% to close at $295.44 on Tuesday.

Analysts expect the company to report quarterly earnings of $7.51 per share, down from $7.83 per share a year ago. The consensus estimate for Cigna’s quarterly revenue is $72.45 billion. It reported $69.75 billion last year, according to Benzinga Pro.

On Oct. 2, Piper Sandler analyst Jessica Tassan maintained an Overweight rating for Cigna and raised the price target from $346 to $370.

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