Personal Finance

How To Earn $1,000 Per Month From Walgreens (NASDAQ: WBA) Stock

Walgreens Boots Alliance Inc. (NASDAQ:WBA) closed at $25.14, 2.07% higher, at the end of the trading hours on Dec. 14. The stock has a 52-week trading range of $19.68 to $41.31 and a total market capitalization of $21.88 billion.

Walgreens Boots Alliance is a holding company with ownership interests in subsidiary companies as primary assets. Its subsidiary companies operate in the retail pharmacy and healthcare sector in the U.S. and other countries. The parent company relies on its operating subsidiaries to fund dividend payments to the shareholders.

The company has declared a dividend of $0.48 per share every quarter of fiscal 2023. The dividend payout is $1.92 with a dividend yield of 9.21%. The total cash dividends for the year are $1.7 billion, consistent with the dividends for the preceding year.

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How Can You Earn $1,000 Per Month As A WBA Investor?

Assuming your target is to make $1,000 per month or $12,000 annually from Walgreens Boots Alliance’s dividends, you need to invest $130,293. At $25.14 per share, this translates to holding 5,183 shares. If you reduce your target to $200 per month or $2,400 annually, the investment value is $26,059 or 1,036 shares.

Using dividend yield to estimate the investment value: Your investment value estimate can be derived using the desired annual income of $12,000 or $2,400 and the dividend yield, which is 9.21%.

The dividend yield is a percentage calculated by dividing the dividend payments by the market price of a stock.

To earn $1,000 per month, your estimated investment value is $12,000 / 0.0921 or $130,293. If you opt for a $200 monthly income, the investment value is $2,400 / 0.0921 or $26,059.

When making this estimation, it is important to remember that a company’s dividend yield can change over time. This change can be attributed to the fluctuations in stock prices as well as the dividend policies of the company. The estimated investment value calculations do not factor the capital appreciation in stock prices. If those are not considered in the calculation, the dividend value and its yield are positively correlated.

Assume a stock paying a $2 annual dividend is trading at $50. The dividend yield would be $2 / $50 or 4%. When the stock price jumps to $60, the dividend yield drops to $2 / $60 or 3.33%. If the stock price falls to $40, this will trigger an inverse effect and increase the dividend yield to 5% ($2 / $40). As fluctuations in stock price impact the yield, changes in the company’s dividend policies also affect the yield.

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