Dividend Yield: The Crucial Metric for Income-Seeking Investors

Income-seeking investors often look for dividend-paying stocks to generate recurring income.

The dividend yield is a crucial metric to consider before buying any dividend stock, according to an expert. This is calculated by dividing the expected total per-share payments over the coming year by the stock's current price.

A beverage company like Coca-Cola (NYSE: KO) is a good example of this. With a current price of just over $89 per share and an expected payout of $2.12, its dividend yield is around 2.4%.

However, past performance is not always a guarantee of future results, so it's essential to consider other factors such as the company's ability to continue paying its dividend and how the payment has changed over time.