How To Earn $500 A Month From Humana Stock Ahead Of Q3 Earnings

Humana Inc. (NYSE:HUM) investors may be eyeing potential dividends gains ahead of the company’s third-quarter earnings report on Friday, Nov. 6.

Currently, Humana has an annual dividend yield of 0.85%, which is a quarterly dividend amount of 88.5 cents per share ($3.54 a year).  

So, how can investors exploit its dividend yield to pocket a regular $500 monthly?

To earn $500 per month or $6,000 annually from dividends alone, you would need an investment of approximately $707,527 or around 1,695 shares. For a more modest $100 per month or $1,200 per year, you would need $141,505 or around 339 shares.

To Calculate

Divide the desired annual income ($6,000 or $1,200) by the dividend ($3.54 in this case). So, $6,000 / $3.54 = 1,695 shares ($500 per month), and $1,200 / $3.54 = 339 shares ($100 per month).

Note that dividend yield can change on a rolling basis, as the dividend payment and the stock price both fluctuate over time.

How That Works

The dividend yield is computed by dividing the annual dividend payment by the stock’s current price.

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

Similarly, changes in dividend payments can affect yield. If a company increases its dividend, the yield will also increase, provided the stock price stays the same. Conversely, if the dividend payment decreases, so will the yield.

HUM Price Action

Humana shares fell 0.1% to close at $417.42 on Wednesday.

Analysts expect the company to report a quarterly loss of $1.00 per share, versus a profit of $3.24 per share in the year-ago period. The consensus estimate for Humana’s quarterly revenue is $40.89 billion. It reported $32.65 billion last year, according to Benzinga Pro.

On Oct. 13, Mizuho analyst Ann Hynes maintained Humana with an Outperform rating and raised the price target from $468 to $495

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