The yearly dividend paid by RTF Inc. common stock increases by 4.4% annually, and its predicted rate of return is 8.2%. Hence, the dividend yield is 3.8%.
The dividend yield, which is expressed as a percentage and is a financial ratio (dividend/price), shows how much a company pays in dividends each year in comparison to the price of its stock.
Price/Dividend, often known as the dividend payout ratio, is the counterpart of dividend yield.
A stock investment's projected return on dividends only is represented by the dividend yield. If the dividend is not increased or cut, the yield will rise as the price of the stock falls. In the reverse situation, it will fall as the stock price rises. Dividend yields can appear excessively high for stocks that are declining quickly because they fluctuate in relation to stock prices.
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