How to Calculate Dividends

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Investors often like dividend-paying stocks because they provide ongoing income opportunities. Companies pay periodic dividends to reward shareholders and to motivate ongoing investment interest. To calculate your dividend amount, multiply the periodic dividend the company declares per share by the total amount of shares you own.

Quarterly Dividend Example

  • Companies typically declare dividends by the quarter or year. If your stock pays $0.20 per share each quarter, and you own 2,000 shares, multiply $0.20 by 2,000 to compute your quarterly dividend. In this case, you would receive a $400 dividend on the payout date if you were a shareholder of record on the execution date.

Annual Dividend Example

  • Companies may declare dividends on an annual basis, but pay them quarterly or annually. For an annual dividend, just multiply the declared amount per share by your total shares as you do with a quarterly dividend. If the company indicates an annual dividend of $1, but it makes quarterly payments, it equates to $0.25 each quarter.

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