How To Earn $500 A Month From McDonald's Stock Ahead Of Q4 Print

McDonald's Corporation MCD is expected to release earnings results for its fourth quarter, before the opening bell on Feb. 5, 2024.

Analysts expect the fast food giant to report quarterly earnings at $2.82 per share, up from year-ago earnings of $2.59 per share. The Chicago-based company is projected to report quarterly revenue of $6.45 billion, compared to $5.93 billion in the year-earlier quarter, according to data from Benzinga Pro.

McDonald's CEO Chris Kempczinski, last month, released a letter regarding headwinds related to war in the Middle East. In the letter, Kempczinski reflected on 2023 and warned of potential headwinds in markets in and around the Middle East.

"Several markets in the Middle East and some outside the region are experiencing a meaningful business impact due to the war and associated misinformation that is affecting brands like McDonald’s," Kempczinski said.

With the recent buzz around McDonald's, some investors may be eyeing potential gains from the company’s dividends. As of now, the Happy Meal innovator has a dividend yield of 2.24%, which is a quarterly dividend amount of $1.67 a share ($6.68 a year).

To figure out how to earn $500 monthly from McDonald's dividends, we start with the yearly target of $6,000 ($500 x 12 months).

Next, we take this amount and divide it by McDonald's $6.68 dividend: $6,000 / $6.68 = 898 shares

So, an investor would need to own approximately $267,676 worth of McDonald's, or 898 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 / $6.68 = 180 shares, or $53,654 to generate a monthly dividend income of $100.

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Note that dividend yield can change on a rolling basis, as the dividend payment and the stock price both 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.

MCD Price Action: Shares of McDonald's gained 1.8% to close at $298.08 on Thursday.

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