Micron Technology, Inc. (NASDAQ:MU) reported better-than-expected second-quarter financial results and issued strong third-quarter guidance on March 20, 2024.
Micron reported first-quarter revenue of $5.82 billion, which beat the consensus estimate of $5.342 billion. The company reported adjusted earnings of 42 cents per share, which easily beat analyst estimates for a loss of 25 cents per share.
Micron said it expects fiscal third-quarter revenue of $6.6 billion, plus or minus $200 million, versus estimates of $6 billion. The company anticipates third-quarter adjusted earnings of 38 cents to 52 cents per share versus estimates of 20 cents per share.
Last week, multiple analysts, including Piper Sandler, B of A Securities, TD Cowen, Wedbush, Stifel, Mizuho, Rosenblatt and Needham, raised their price targets on the stock following earnings report.
With the recent buzz around Micron, some investors may be eyeing potential gains from the company’s dividends. As of now, Micron has a dividend yield of 0.39%, which is a quarterly dividend amount of 11.5 cents a share (46 cents a year).
To figure out how to earn $500 monthly from Micron, we start with the yearly target of $6,000 ($500 x 12 months).
Next, we take this amount and divide it by Micron’s $0.46 dividend: $6,000 / $0.46 = 13,043 shares
So, an investor would need to own approximately $1,527,727 worth of Micron, or 13,043 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 / $0.46 = 2,609 shares, or $305,592 to generate a monthly dividend income of $100.
Also Read: Cramer Isn’t ‘Knocking’ This Pharma Firm Anymore: ‘As A Matter Of Fact, I’m Going In’
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.
MU Price Action: Shares of Micron gained 6.3% to close at $117.13 on Monday.
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