ConAgra Brands, Inc. (NYSE:CAG) will release first-quarter earnings before the opening bell on Wednesday, Sept. 30.

With recent buzz around the company, some investors may be eyeing potential dividend gains. Currently, ConAgra has an annual dividend yield of 4.94%, with a quarterly dividend of 17.5 cents per share (70 cents 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 about $121,365, or around 8,571 shares. For a more modest $100 per month or $1,200 per year, you would need $24,270 or around 1,714 shares.

To calculate: Divide the desired annual income ($6,000 or $1,200) by the dividend ($0.70 in this case). So, $6,000 / $0.70 = 8,571 shares ($500 per month), and $1,200 / $0.70 = 1,714 shares ($100 per month).

Note that dividend yield can change on a rolling basis, as dividend payments and stock prices 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, the yield will too.

CAG Price Action

Shares of ConAgra Brands fell 1.1% to close at $14.16 on Monday.

Analysts expect the company to report quarterly earnings of 28 cents per share, down from 39 cents per share a year ago. The consensus estimate for CAG’s quarterly revenue is $2.59 billion. It reported $2.63 billion last year, according to Benzinga Pro.

On Aug. 4, Conagra Brands named Amy Held as executive vice president and chief administrative officer.

Photo via Shutterstock