How much does a company pay a dividend per share?

The absolute dividend amount you receive per share is a less helpful metric because companies have widely varying stock prices. For example, Companies A and B both pay an annual dividend of $2 dividend per share. Company A’s stock is priced at $50 per share, however, while Company B’s stock is priced at $100 per share.

Why do companies pay dividends?

Dividends are a portion of a company’s profits that it returns to shareholders. Dividends are offered to investors to reward them for owning shares of the company, and also to distribute excess cash that isn’t being reinvested back into the company. Not all companies pay dividends.

How are dividends paid?

Dividends are generally paid quarterly, with the amount decided by the board of directors based on the company's most recent earnings. Dividends may be paid in cash or additional shares. When a company announces a dividend, it also will announce the payment date on which the dividend will be paid into the shareholders' accounts.