Dividend yield (%)
An important key figure that shows the company's return to you as a shareholder. Many people compare Dividend yield to a bank interest rate, as the company pays out part of its profit to you as a shareholder.
Dividend yield = Dividend per Share/Share Price
Dividend yield is a company's share dividend in relation to the share price and a measure of the return to shareholders.
Dividend involves the company paying out part of its profit to you as a shareholder. You will then receive a portion of the earnings per share that you own. Many companies do not pay dividends; dividends are usually paid by larger, stable companies.
The dividend is usually paid once a year, but nowadays, companies are increasingly paying several dividends per year.
The dividend is usually paid in the spring, a few days after the Annual General Meeting.
In some cases, the company decides on an extra dividend, which results in greater dividends for you as a shareholder.
Things to keep in mind
- Dividends usually provide a stable income from the company even if the share price falls.
- The company decides on the dividend itself, which may mean that the dividend is reduced or stopped completely.
- Combine with the key figure Dividend Payouts (%) to see how much of the profit is reallocated to dividends. If the Dividend Payouts is over 100%, it is a warning sign that the company gives more in dividends than it obtains in profit.
- If you plan to hold a share for an extended time period, the dividend will be the only cash flow you receive until you decide to sell the share.