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

Zinger Key Points
  • A more conservative goal of $100 monthly dividend income would require owning 6,000 shares of Heico.
  • An investor would need to own $6,519,300 worth of Heico to generate a monthly dividend income of $500.

HEICO Corporation HEI shares closed slightly higher on Friday ahead of an earnings report set to be released on Tuesday.

Analysts expect Heico to report quarterly earnings at 81 cents per share, up from 76 cents per share in the year-ago period. The Hollywood, Florida-based company is projected to report quarterly revenue of $951.21 million, according to data from Benzinga Pro.

On Feb. 26, Heico reported better-than-expected first-quarter financial results.

With the recent buzz around Heico, some investors may be eyeing potential gains from the company's dividends. As of now, Heico has a dividend yield of 0.09%, which is a semi-annual dividend amount of 10 cents a share (20 cents a year).

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

Next, we take this amount and divide it by Heico's $0.20 dividend: $6,000 / $0.20  = 30,000 shares.

So, an investor would need to own approximately $6,519,300 worth of Heico, or 30,000 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 / $0.20 = 6,000 shares, or $1,303,860 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.

HEI Price Action: Shares of Heico gained 0.7% to close at $217.31 on Friday.

Read More: Top 3 Materials Stocks That Are Set To Fly This Quarter

Photo: rafapress/Shutterstock

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