Skip to content
Lynktor
Investing

Dividend Yield

What is Dividend Yield?

The annual dividend per share divided by the share price.

Understanding Dividend Yield

Dividend yield shows how much cash income a stock pays relative to its price.

A very high yield can signal a falling share price or a dividend at risk of being cut.

Formula

Dividend yield=Annual dividends per sharePrice per share\text{Dividend yield} = \frac{\text{Annual dividends per share}}{\text{Price per share}}

Example

A $100 stock paying $3 a year has a 3% dividend yield.

FAQ

Is a high dividend yield always good?

No. A yield can rise because the share price fell, which may signal that the dividend is at risk of a cut.

Esc
  • Dictionary A–ZBrowse every term
  • CalculatorsCompound interest, mortgage, retirement…