Dividend Yield

Dividend Yield is a financial ratio that shows how much a company pays out in dividends each year relative to its stock price. It is calculated by dividing the annual dividend per share by the stock's current market price.

For income-focused investors, dividend yield is a key metric for comparing the relative attractiveness of different dividend-paying stocks. A higher yield indicates more income per dollar invested.

However, an unusually high dividend yield can sometimes be a warning sign, as it may indicate that the stock price has fallen significantly or that the dividend may not be sustainable.