Why does yield go up when a stock price falls?

Yield is dividend ÷ price — if the dividend stays the same but price drops, the same math produces a higher yield.

A Dividend Reinvestment Plan automatically uses your dividend cash to buy more shares instead of paying it out to you.

Are reinvested dividends taxed?

In most jurisdictions, yes — dividends are generally taxable in the year received even if a DRIP immediately reinvests them. Check local rules; this calculator doesn't model taxes.

Is a high dividend yield always good?

Not necessarily — very high yields sometimes precede a dividend cut, especially if a company pays out more than it earns.

Does this calculator account for dividend cuts or suspensions?

No — it assumes your chosen dividend growth rate holds constant every year.

What's a 'good' dividend yield?

It varies by sector and market conditions — there's no single universal benchmark.

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Finance

Dividend Yield Calculator

Current yield from price and dividend, plus a DRIP reinvestment projection.

🔒 Runs entirely in your browser — nothing here is ever uploaded

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Last reviewed 2026-08-30

About the Dividend Yield Calculator

Calculates a stock's current dividend yield from its share price and annual dividend per share, then projects a DRIP (Dividend Reinvestment Plan) scenario where each year's dividend income buys more shares, compounding income and share count over time.

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How to use it

Enter the Annual dividend per share and Current share price to get the yield.
Enter your Starting shares and Years to project for the DRIP section.
Optionally set Dividend growth/yr and Share price growth/yr.
Read the projected share count, reinvested shares gained, and projected annual income.

Formula

Dividend yield = Annual dividend per share ÷ Current share price × 100. DRIP projection: each year, income = shares held × that year's dividend per share (grown at your assumed rate); that income buys income ÷ that year's share price (grown at your assumed rate) additional shares, added to the share count for the following year.

Worked example

A $1.80 annual dividend on a $50 share price gives a 3.6% yield. Starting with 100 shares, 3% annual dividend growth, and flat share price over 5 years: reinvestment grows the position to about 120.6 shares, having collected roughly $1,032 in total dividends along the way.

Interpreting your result

The DRIP projection assumes dividend and price growth rates stay constant every year, which real markets never do exactly. Treat it as a directional planning tool, not a forecast. It also ignores taxes on reinvested dividends, which are typically still taxable in the year received even though you never receive the cash.

Recommendations

• A yield much higher than similar companies can be a warning sign (a falling share price mechanically raises yield) rather than a bargain.
• DRIP compounding works fastest when share price growth is flat or negative in the short term, since each dividend payment buys more shares at a lower price.
• Dividend growth rate matters more than it looks over long horizons — even a modest 3-5%/yr dividend growth compounds substantially over 10-20+ years.

Frequently asked questions

The annual dividend per share divided by the current share price, expressed as a percentage.