How To Earn $500 A Month From Toll Brothers Stock Ahead Of Q3 Earnings

Toll Brothers, Inc. TOL will release earnings results for the third quarter, after the closing bell on Tuesday, Aug. 19.

Analysts expect the Fort Washington, Pennsylvania-based company to report quarterly earnings at $3.60 per share, down from $3.64 per share in the year-ago period. Toll Brothers projects to report quarterly revenue of $2.86 billion, compared to $2.73 billion a year earlier, according to data from Benzinga Pro.

The company beat analyst estimates for earnings per share in the second quarter and has beaten analyst estimates in eight of the last 10 quarters overall.

With the recent buzz around Toll Brothers, some investors may be eyeing potential gains from the company's dividends too. As of now, Toll Brothers offers an annual dividend yield of 0.76%, which is a quarterly dividend amount of 25 cents per share ($1.00 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, you need an investment of about $787,080. That’s around 6,000 shares. For a more modest $100 per month or $1,200 per year, you would need $157,416 or around 1,200 shares.

To calculate: Divide the desired annual income ($6,000 or $1,200) by the dividend ($1.00 in this case). So, $6,000 / $1.00 = 6,000 ($500 per month), and $1,200 / $1.00 = 1,200 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.

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.

TOL Price Action: Shares of Toll Brothers rose 0.5% to close at $131.18 on Monday.

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