How To Earn $1,000 Per Month From Lowe's Cos. Stock

Home improvements product retailer Lowe’s Cos. Inc. (NYSE:LOW) stock closed at $225.59 at the end of trading hours on Dec. 15. The stock price is close to its 52-week high price of $237.205. The 52-week low price for the stock was $181.85.

The company filed its Form 10-Q on Nov. 29 for the quarter from Aug. 4 to Nov. 3 on Nov. 3. According to the cash flow statement, dividend expenses for the quarter were $633 million. The cumulative dividend expense for the first three quarters of 2023 was $1.899 billion. According to consolidated statements of shareholders' deficit, the cash dividend per share per share for the three quarters was $3.25. For the same period in 2022, the cash dividend was $2.90 per share.    

Based on the cash dividend of $3.25 per share for the first three quarters, the annualized dividend is approximately $4.33. Considering the stock price on Dec. 15, Lowe's Cos.'s dividend yield is 1.92%

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How Can You Earn $1,000 Per Month As A Lowe's Cos. Investor?

If your earnings target is $1,000 per month — $12,000 annually — from Lowe's dividends, you need to invest close to $625,000, which is 2,771 shares at $225.59 each. If you choose an earnings target of $200 per month, your investment value decreases to $125,000 or 554 shares.

Calculating an estimated value of investments with the help of dividend yields: To determine your estimated investment value, you will need two key parameters. The first is your annual earnings target — $12,000 or $2,400 — and the second is the dividend yield of a stock, which is 1.92% for Lowe's. So, $12,000 / 0.0192 = $625,000 for generating earnings of $1,000 per month, and $2,400 / 0.0192 = $125,000 for $200 per month.

To calculate the dividend yield of a stock, divide its annual dividend payments by the current price of the stock. The dividend yield of a stock tends to change on a rolling basis. This is because of the fluctuations in the market price of the stock as well as the company's dividend policies over time.

These calculations have not considered the appreciation of a stock. If those are not factored into the capital appreciation, the dividend value and its yield are positively correlated. 

For instance, 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 on Dec. 15 using an annualized dividend. The price of Lowe's Co. stock at the end of the extended trading hours of Dec 20 was $222.03

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