Toll Brothers, Inc. (NYSE:TOL) will release earnings for the first quarter after the closing bell on Tuesday, Feb. 17.
Analysts expect the homebuilder to report earnings of $2.11 per share. That's up from $1.75 per share in the year-ago period. The consensus estimate for Toll Brothers' quarterly revenue is $1.85 billion (it reported $1.86 billion last year), according to Benzinga Pro. On Feb. 10, Oppenheimer analyst Tyler Batory maintained Toll Brothers with an Outperform rating and raised the price target from $155 to $177.
Some investors are likely eyeing potential gains from the company's dividends. Currently, Toll Brothers has an annual dividend yield of 0.60%. That’s a quarterly dividend amount of 25 cents per share ($1.00 a year).
To figure out how to earn $500 monthly from Toll Brothers, we start with the yearly target of $6,000 ($500 x 12 months).
Next, divide that amount by TOL's $1.00 dividend: $6,000 / $1.00 = 6,000 shares.
So, an investor would need to own approximately $996,720 worth of Toll Brothers, or 6,000 shares to generate a monthly dividend income of $500.
Assuming a more conservative goal of $100 monthly ($1,200 annually), we do the same calculation: $1,200 / $1.00 = 1,200 shares, or $199,344 to generate a monthly dividend income of $100.
Note that the dividend yield can change on a rolling basis as dividend payments and stock prices fluctuate over time.
The dividend yield is calculated by dividing the annual dividend payment by the current stock price. As the stock price changes, the dividend yield will also change.
For example, if a stock pays an annual dividend of $2 and its current price is $50, its dividend yield would be 4%. However, if the stock price increases to $60, the dividend yield would decrease to 3.33% ($2/$60).
Conversely, if the stock price decreases to $40, the dividend yield would increase to 5% ($2/$40).
Further, the dividend payment itself can also change over time, which can also impact the dividend yield. If a company increases its dividend payment, the dividend yield will increase even if the stock price remains the same. Similarly, if a company decreases its dividend payment, the dividend yield will decrease.
TOL Price Action: Shares of Toll Brothers gained by 2.2% to close at $166.12 on Friday.
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