Dividend Yield

A financial ratio showing how much a company pays out in dividends relative to its stock price. Calculated as annual dividends per share divided by stock price. A common metric for income investors.

Income investors use dividend yield to compare how much cash different stocks return relative to price. A very high yield can be a warning sign — it often reflects a falling share price rather than a generous payout — so yield is best read alongside the payout ratio and dividend growth history.