The Dividend Quality and Forecast section in the portfolio is designed to help you evaluate the reliability and growth potential of dividend payments across the companies in your portfolio. This analysis includes data on each company's contribution to your dividend income, its yield versus yield on cost, a dividend score, and growth projections. A visual chart also breaks down the quality of these dividends, based on each company's dividend score, offering a clear snapshot of your dividend income and their sustainability.
Last 1Y Payment & Contribution
The Last 1Y Payment & Contribution represents the dividend income earned over the past year. This metric provides a snapshot of the investor’s annual income generated solely from dividend payouts, offering insight into the cash flow benefits associated with their holdings.
Formula:
Last 1-Year Payment & Contribution = Number of Shares × Total Dividends Paid in Last 12 Months
Sample Calculation:
- Stock: NasdaqGS: MSFT
- Number of Shares: 2
- Total Dividends Paid in Last 12 Months: $3 (Quarterly dividend of $0.75 × 4 quarters)
Calculations (Using the data in the below screenshots):
Last 1-Year Payment & Contribution = 2 shares × $3 = $6
Future Payment & Contribution
The Future Payment & Contribution projects the expected dividend income over the next 12 months, 2 years, and 3 years. It provides investors with an outlook on potential future cash flow from dividends, based on growth expectations and the company’s dividend policy. This forecasted income helps in planning for future earnings and assessing the long-term income potential of the investment based on current holdings.
Formula:
Future Payment & Contribution= Forecasted Annual Dividend per Share× Number of Shares
Yield vs. Yield on Cost
- Dividend Yield
- This is the percentage that represents the estimated annual dividend income a shareholder could earn from every dollar invested in a stock.
- Formula:
- Dividend Yield= Annualized Dividend Per Share ÷ Latest End-Of-Day Price
- Yield on Cost
- It focuses on the return based on the capital invested. This metric highlights the effectiveness of the original investment, showing how the yield has grown over time relative to the purchase price.
- Formula:
- Dividend Yield on Cost = Last 1-Year Dividends Paid/ Total Capital Invested
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Sample Calculation:
- Stock: NasdaqGS:AAPL
- Number of Shares: 10
- Total Capital Invested: $204.83
- Total Dividends Paid in Last 12 Months: $10
- Dividend Yield: 0.4%
Calculations (Using the data in the below screenshots):
Yield on Cost = $10/ $204.83 = 0.0048% or 4.8%
Dividend Score & Growth
- Dividend Score
- This reflects each company’s dividend analysis score. A higher score indicates a stronger and more reliable dividend-paying track record. You can learn more about the dividend analysis checks here.
- Dividend Growth
- This represents the annual growth rate of dividends, highlighting how the company's dividend payouts have increased over time.