Divide the annual dividend by the share price to get the yield.
A dividend yield calculator shows the annual income a stock pays as a percentage of its price, the yardstick income investors use to compare how much cash different stocks return relative to what they cost.
Dividend yield is annual dividends per share รท share price. A $100 stock paying $3 a year yields 3%. Because price is in the denominator, the yield rises when the price falls and drops when the price climbs, so a high yield can reflect either a generous payout or a stock the market has marked down. It's a useful comparison tool, not a complete picture on its own.
A very high yield sometimes signals trouble: if a company's price has dropped on fears it will cut the dividend, the trailing yield looks large right before the payout shrinks, a 'yield trap.' Sustainable income depends on the payout ratio (the share of earnings paid out) and whether the business can maintain and grow the dividend. Total return also includes price appreciation, so a lower-yielding grower can outperform a high-yielder over time.
Divide the annual dividend per share by the current share price, then multiply by 100. A $4 dividend on an $80 stock is a 5% yield.
Not always. A high yield can mean a generous payout, or a beaten-down price that signals a possible dividend cut. Check the payout ratio and the company's stability.
It varies by sector and market conditions. Compare a stock's yield to its peers and its own history rather than to a single universal benchmark.
See the exact formula and a worked example on our methodology page.