J.M. Smucker Stock Offers 3.56% Annual Dividend Yield—How to Earn $500 Monthly

The J. M. Smucker Company will release its first-quarter earnings before the market opens on Wednesday, August 26.

Analysts expect the company to report quarterly earnings of $2.22 per share, up from $1.90 per share in the same period last year. The consensus estimate for J.M. Smucker's quarterly revenue is $2.13 billion. Revenue reported last year was $2.11 billion.

Ahead of the quarterly earnings release, UBS analyst Peter Grom maintained a Buy rating on J.M. Smucker on August 20 and raised the price target from $130 to $142.

With recent buzz around J.M. Smucker, some investors may also be eyeing potential gains from the company's dividends. Currently, SJM offers an annual dividend yield of 3.56%, with a quarterly dividend of $1.12 per share.

So, how can investors use its dividend yield to earn $500 monthly?

To make $500 per month or $6,000 annually from dividends, you would need to invest approximately $168,540 or about 1,339 shares. For a more modest goal of $100 per month or $1,200 annually, you would need $33,733 or about 268 shares.

Calculation: Divide the desired annual income by the dividend. Thus, $6,000 / $4.48 = 1,339 shares, and $1,200 / $4.48 = 268 shares.

Note that dividend yields can change over time, as both dividend payments and stock prices fluctuate.

How It Works

The dividend yield is calculated by dividing the annual dividend payment by the stock's current price.

For example, if a stock pays an annual dividend of $2 and the current price is $50, the dividend yield is 4%. However, if the stock price rises to $60, the dividend yield drops to 3.33%. Conversely, if the stock price falls to $40, the dividend yield rises to 5%.

Similarly, changes in dividend payments affect the yield. If a company increases its dividend, the yield also increases, provided the stock price remains unchanged. Conversely, if dividend payments decrease, the yield declines.

SJM Stock Performance

Smucker shares rose 1.3% on Monday, closing at $125.87.