My Current Effective Dividend Yield: Pfizer
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Pfizer has been one of those stocks that continues to increase its dividend year after year, yet the stock price does not respond. There is a lot of uncertainty around the product pipeline and the expiry of key patents. However, the stock continues to increase its dividends and as we know from research, these types of stocks tend to go up over time.
As a reminder, I am doing a post similar to this for each of the stocks in my portfolio – links to each post as they come up will be placed in the sidebar on the right of your screen.
Business Summary:
Pfizer Inc is a research-based, global pharmaceutical company that discovers and develops innovative, value-added products that improve the quality of life of people around the world and help them enjoy longer, healthier, and more productive lives. Pfizer has three business segments: health care, animal health and consumer health care. Its products are available in numerous countries.
My Dividend Yield Data
| Pfizer | ||||
|---|---|---|---|---|
| Original Yield | ||||
| Date | Ticker | Initial Buy Price | Initial Div Per Year | Initial Yield |
| December 19, 2005 | PFE | $24.98 | $0.76 | 3.04% |
| Current Yield | ||||
| Average Price Per Share | Shares | Current Div Per Share | Current Yield | Annual Div’s Rec’d |
| $24.38 | 105.3735 | $0.90 | 5.25% | $134.88 |
Table Explanation:
The table is dividend into two sections: Original Yield and Current Yield. Original yield presents the data from my initial purchase in the security and the resulting yield. The Current Yield is the yield I am receiving on my investment, given the growth in dividends as well as reinvested dividends. As I receive dividends they are reinvested into additional shares which is factored into this calculation. Essentially, I calculate the average share price for all shares and use this price to calculate the current yield (Current Yield = Current Dividend / Average Share Price).
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3 Comments on this post
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Options Strategery said:
There is also the risk of government intervention on product pricing. If the democrats start meddling with healthcare, we might see the same sort of sudden drop as in Humana, Wellpoint, etc.
March 16th, 2008 at 1:28 pm -
Siddharth said:
Can you clarify as to how you calculate the Average Price of Share. It seems that when the dividends are received and they are reinvested in the shares the Purchase price of those shares is considered as zero when deriving the Average share price which can skew this results in favour of the stock performance.
March 16th, 2008 at 2:27 pm -
dan said:
I think you’re looking at this the wrong way. You said (first line) Pfizer has increased it’s dividend but stock price hasn’t increased …
I would say, the stock price hasn’t increased so they keep raising their dividend. Am I coming through with the subtle difference? They’re not a growth play but more of a value play (if at all)– they use profits to return money to shareholders because they dont need all their profits. Its not as if a company that size, using all their profits for expansion, would be able to become more considerably valuable.March 18th, 2008 at 8:47 am
