Dividend yield measures annual dividend income per share relative to the share price: annual payout per share divided by share price. It expresses a pre-tax income return, not a guarantee of total return. section 1.2.1 section 5.1
Use the metric as one input in income-stock analysis. A high yield can reflect generous distributions, but it can also result from a falling share price and signal greater risk that the annual payout will be reduced. section 5.1 section 2.4.6
Read dividend yield alongside related measures:
- Annual payout records the total dividend paid per share each year; payout frequency records how often payments arrive. section 5.1
- Payout ratio shows the fraction of net income distributed to shareholders; a smaller ratio can leave more room for growth and reinvestment. section 5.1
- Dividend growth and dividend growth rate indicate whether distributions have increased consistently and how quickly they are growing. section 5.1
- Compare the yield with alternatives such as Treasury bonds, and account for inflation, capital appreciation, and taxation. section 1.2.1 section 5.1
Apple versus a Treasury yield
With Apple at about $213.55 and paying roughly $0.26 quarterly, annual dividends total approximately $1.04 per share. Dividing $1.04 by $213.55 produces a yield near 0.49%. A roughly 4.3% 10-year US Treasury yield was therefore considerably higher in the cited June 2025 comparison, making dividend income alone a weak reason to choose Apple. section 1.2.1
A dividend scorecard
A Python-collected scorecard places yield beside sector, industry, and payout ratio. Its examples range from NVIDIA at 0.03% yield and 0.0129 payout ratio to Altria at 6.89% and 0.6779, showing why yield should not be interpreted without distribution and business context. section 2.4.6
Table 2.9 Dividends of Apple, Altria, Microsoft, NVIDIA, Sempra, Walmart, and Coca-Cola highlighting different payout strategies
|
Company
|
Yield FWD %
|
Payout ratio %
|
Div growth 5Y %
|
Consecutive years of growth
|
Consecutive years of dividend payments
|
|---|---|---|---|---|---|
|
Apple (AAPL)
|
0.51
|
14.10
|
5.24
|
12
|
12
|
|
Altria (MO)
|
6.89
|
77.54
|
4.00
|
55
|
55
|
|
Microsoft (MSFT)
|
0.71
|
25.04
|
10.24
|
20
|
20
|
|
NVIDIA (NVDA)
|
0.03
|
1.25
|
20.11
|
1
|
12
|
|
Sempra (SRE)
|
3.36
|
53.18
|
4.88
|
14
|
26
|
|
Walmart (WMT)
|
0.96
|
34.03
|
4.41
|
51
|
51
|
|
Coca-Cola (KO)
|
2.86
|
67.99
|
4.20
|
62
|
62
|
|
Data from Seeking Alpha on June 8, 2025 (
https://seekingalpha.com)
|
Compare dividend yield, payout ratio, five-year dividend growth, and payment histories across growth-oriented and income-oriented companies. section 2.4.6
