How To Earn $500 A Month From Calavo Growers Stock Ahead Of Q2 Earnings

Calavo Growers, Inc. CVGW will release earnings results for the second quarter, after the closing bell on Monday, June 9.

Analysts expect the Santa Paula, California-based company to report quarterly earnings at 53 cents per share, up from 50 cents per share in the year-ago period. According to data from Benzinga Pro, Calavo Growers projects quarterly revenue at $192.75 million, compared to $184.38 million a year earlier.

On March 18, Calavo Growers announced a $25 million stock repurchase program.

With the recent buzz around Calavo Growers, some investors may be eyeing potential gains from the company's dividends too. As of now, Calavo Growers offers an annual dividend yield of 2.89%, which is a quarterly dividend amount of 20 cents per share (80 cents 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 $207,600 or around 7,500 shares. For a more modest $100 per month or $1,200 per year, you would need $41,520 or around 1,500 shares.

To calculate: Divide the desired annual income ($6,000 or $1,200) by the dividend ($0.80 in this case). So, $6,000 / $0.80 = 40,000 ($500 per month), and $1,200 / $0.80 = 8,000 shares ($100 per month).

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

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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 is currently priced at $50, the dividend yield would be 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 the dividend payment can impact the 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.

CVGW Price Action: Shares of Calavo Growers gained 4% to close at $27.68 on Friday.

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