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

Visa Inc. (NYSE:V) is set to report third-quarter earnings after the closing bell on Tuesday, July 29. The report follows news that Japan's Fair Trade Commission has taken its first administrative action against the credit card industry, targeting Visa Worldwide Pte Ltd.—a Singapore-based subsidiary—for alleged monopolistic practices.

Analysts expect the San Francisco-based company to report earnings of $2.85 per share, up from $2.42 per share a year ago. Revenue is projected to reach $9.85 billion, compared to $8.9 billion in the same quarter last year, according to Benzinga Pro.

Amid heightened attention on Visa, some investors are also eyeing its dividend potential. The company currently offers a dividend yield of 0.66%, paying 59 cents per share semi-annually, or $2.36 annually.

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

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To earn $500 per month or $6,000 annually from dividends alone, you would need an investment of approximately $903,605 or around 2,542 shares. For a more modest $100 per month or $1,200 per year, you would need $180,579 or around 508 shares.

To calculate: Divide the desired annual income ($6,000 or $1,200) by the dividend ($2.36 in this case). So, $6,000 / $2.36 = 2,542 ($500 per month), and $1,200 / $2.36 = 508 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 is currently priced at $50, the dividend yield would be 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 the dividend payment can impact the 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.

V Price Action: Shares of Visa fell 0.4% to close at $355.47 on Monday.

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