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

Designer Brands Inc. DBI will release earnings for its third quarter, before the opening bell on Tuesday, Dec. 10.

Analysts expect the Columbus, Ohio-based company to report quarterly earnings at 35 cents per share, up from 24 cents per share in the year-ago period. Designer Brands projects to report quarterly revenue of $802.14 million, compared to $786.33 million a year earlier, according to data from Benzinga Pro.

On Dec. 4, Telsey Advisory Group analyst Dana Telsey maintained Designer Brands with a Market Perform and maintained a $6 price target.

With the recent buzz around Designer Brands, some investors may be eyeing potential gains from the company's dividends, too. Currently, Designer Brands — the parent company of Designer Shoe Warehouse and Topo Athletic — offers an annual dividend yield of 3.44%, a quarterly dividend amount of 5 cents per share (20 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 approximately $174,600 or around 30,000 shares. For a more modest $100 per month or $1,200 per year, you would need $34,920 or around 6,000 shares.

To calculate: Divide the desired annual income ($6,000 or $1,200) by the dividend ($0.20 in this case). So, $6,000 / $0.20 = 30,000 ($500 per month), and $1,200 / $0.20 = 6,000 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.

Price Action: Shares of Designer Brands gained 1.2% to close at $5.82 on Friday.