Microsoft Stock Secrets: How To Make $1,000 a Month With Dividends
When it comes to explaining the power of stock market investing, one example that frequently makes the rounds is how rich you would be now if you had invested in Microsoft when the software company went public in 1986. As Benzinga reported last fall, $1,000 worth of Microsoft stock at its IPO has since ballooned in value to more than $4.5 million. Today, you could earn about $1,000 a month just on Microsoft dividends alone — if you have enough shares.
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A recent analysis from Benzinga, published on March 8, looked at the potential dividend payout if you are invested in Microsoft stock. The Redmond, Washington-based tech giant currently pays a dividend of $0.75 per share, which equals an annual dividend of $3 per share.
At the time of the Benzinga analysis, Microsoft’s stock price was $409.14 a share. It has since fallen back and currently trades near $396 — up roughly 5% since the beginning of the year. At the former price of $409.14, the stock’s dividend yield equaled 0.72%, according to Benzinga.
So how could you earn $1,000 just for being a Microsoft investor?
Benzinga assumed that your earnings target is $1,000 per month, or $12,000 a year, from Microsoft’s dividends. In this case, your estimated investment value would be about $1,643,836, which is roughly 4,018 shares at $409.14 each.
As Benzinga explained, to calculate your estimated investment value you need two variables: your desired annual earnings target ($12,000) and the dividend yield of the stock (0.73%). Here’s the formula: $12,000 / 0.0073 = $1,643,835.62 to generate an income of $1,000 per month.
Keep in mind that the Benzinga calculation was done nearly two months ago, when Microsoft’s stock sold for $409.14 a share. The numbers have since changed, along with Microsoft’s share price.
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But this much remains true: To earn $1,000 a month on Microsoft dividends, you already need to have a nice pile of money — in this case, more than $1.6 million worth of Microsoft stock. Once again, it takes money to make money.
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