Dividend Yield is the dividend paid by the company over the last year to shareholders divided by the current share price. Eg. If the share price is $1 and the company paid 10c in dividends over the last year, it would be 0.10/1.0 = 10%. So 10% would be dividend yield but it is often written a decimal, such as 10.0. So 7.8 dividend yield would be 7.8% and so on. The purpose of this dividend yield is somewhat similar to interest in a bank, it shows the cash return or "interest" you would receive as a shareholder from the company.
Should be remembered however that if a company has paid $X in dividends it is under no obligation to keep the dividend amount into the future. A company can cut (or cease), hold steady or increase the dividend it pays to shareholders pretty much whenever it likes. Term deposits on the other hand (somewhat like a bond between you and the bank) must pay the agreed interest % each month or year whatever the case maybe.
I was reminded of this in my SMSF this reporting season. A certain coy in the financial sector cut the dividend by 75% between interim and final dividend. The final dividend of a much smaller coy again in the financial sector paid its' dividend the same day, 400% higher gross dividend amount despite half as much capital invested in them. All part of the usual process and a setback to be anticipated.
No one will be talking about QE when the bank runs start for real More European banks will default.....the rehypothication in the UK is so far out of control there is no safe way back for the banks. Sit back and watch it unfold this year, its going to be spectacular.
I posted the csv link.. Works on for the iPhones etc. http://www.afrsmartinvestor.com/share_table/ If you want the xls go to yield leaders and click xls link. Few other goodies on that page, think it gets updated every month or two.
