Reinvesting dividends is one of the biggest drivers of long-term stock returns: over long periods, reinvested dividends have accounted for a large part of the S&P 500’s total return.
How to use the Dividend Calculator
- Share price
- Annual dividend per share
- Money invested
- Number of years
- Dividend frequency (compounding)
- Expected share price growth per year
- Tax on dividends
Results update as you type, and every field accepts the units shown in its menu.
How it works
Enter the share price, the annual dividend per share, the amount invested, the number of years, how often dividends are paid and the expected yearly price growth.
Tips
- Take figures from the same financial statements and the same fiscal year.
- Compare ratios with companies in the same industry, not across industries.
- Use several valuation measures together; no single ratio tells the whole story.
- Market prices change every second – refresh the share price before you rely on a result.
Common mistakes to avoid
- Mixing per-share figures with company totals.
- Using trailing earnings for one company and forward earnings for another.
- Forgetting dilution from options and convertible securities.
Inputs explained
| Field | What to enter |
|---|---|
| Share price | Amount in your currency |
| Annual dividend per share | Amount in your currency |
| Money invested | Amount in your currency |
| Number of years | A number |
| Dividend frequency (compounding) | Choose one: Annually, Semi-annually, Quarterly, Monthly |
| Expected share price growth per year | In % |
| Tax on dividends | In % |
What each result means
- Dividend yield = [Annual dividend per share]÷[Share price]×100
- Final balance (dividends reinvested) = [Money invested]×(1 + [Dividend yield]÷100×(1 – [Tax on dividends]÷100)÷[Dividend frequency (compounding)])^([Dividend frequency (compounding)]×[Number of years])×(1 + [Expected share price growth per year]÷100)^[Number of years]
- Overall growth = ([Final balance (dividends reinvested)]÷[Money invested] – 1)×100
- Profit from dividends = [Money invested]×(1 + [Dividend yield]÷100×(1 – [Tax on dividends]÷100)÷[Dividend frequency (compounding)])^([Dividend frequency (compounding)]×[Number of years])×(1 + [Expected share price growth per year]÷100)^[Number of years] – [Money invested]×(1 + [Expected share price growth per year]÷100)^[Number of years]
- Dividend income in the first year = [Money invested]×[Dividend yield]÷100×(1 – [Tax on dividends]÷100)
Example values
How the main result changes when Share price changes and everything else stays at the example values above:
| Share price | Final balance (dividends reinvested) |
|---|---|
| 25 | 3,959.26 |
| 37.5 | 2,515.85 |
| 50 | 2,001.6 |
| 62.5 | 1,743.89 |
| 75 | 1,590.37 |
| 100 | 1,416.91 |
Formula
Dividend yield = annual dividend per share ÷ share priceWith reinvestment: balance = investment × (1 + yield ÷ n)^(n × years) × (1 + price growth)^yearsWorked example
Inputs — Share price: $50; Annual dividend per share: $3.5; Money invested: $1,000; Number of years: 10; Dividend frequency (compounding): Quarterly; Expected share price growth per year: 0 %; Tax on dividends: 0 %.
Results — Dividend yield = 7 %; Final balance (dividends reinvested) = $2,001.60; Overall growth = 100.16 %; Profit from dividends = $1,001.60; Dividend income in the first year = $70.00.
Frequently asked questions
How are dividends calculated?
Dividend per share × number of shares.
What is a DRIP?
A dividend reinvestment plan that uses dividends to buy more shares automatically.
Are dividends guaranteed?
No – companies can cut or suspend dividends.
What formula does the Dividend Calculator use?
Dividend yield = annual dividend per share ÷ share price.