Lux Investing

why is rite aids dividend so high? i am new to investing and just bought 50 shares to start out.?

It shows that the div/yield is $3.50. does this mean if I had 50 shares last year that i would've received $3.50 per share? and if so do dividends change a lot from year to year or can i expect a similar payout?

Public Comments

1. RAD doesn't pay a dividend - that is an error on Yahoo. You can look up any stocks dividend history on Yahoo by looking at the historical price and selecting "Dividends Only" http://finance.yahoo.com/q/hp?s=RAD&a=11&b=17&c=1984&d=00&e=11&f=2008&g=v ps If you can only afford 50 shares of a 2$ stock then I think you'd be better off putting money into Vanguards S&P 500 mutual fund because the trading costs will eat your money.
2. iS&P also maintained the company's "B," or junk, corporate credit rating. Presumably that's last years dividend. It will more than likely be cut this time. The shares have fallen from $7: that will make a big difference to the yield. Was there a special payment/dividend when they made an acquisition last June. Something doesnt look right does it; you can't get a $3.50 div on a $2.20 share! As someone else answered looks like a mistake. If you see something that does not add up--look into it further
3. Don't buy stocks that are trading for under $5, you will lose almost all of your money almost all of the time! And that IS a mistake on the yield. Think about it, if RAD really did pay $3.50 per share per year, that would be a "yield" of 180% a year, more than TEN TIMES the rosiest outlook anyone serious might have!
4. You are new to investing - buying 50 shares of a stock and not knowing why their dividend is high -- isn't investing -- that is gambling. You are better off betting on your favorite sports team. If you want to gamble that is ok just don't fool yourself. If you are new to investing you should probably be in mutual funds, index funds preferably. Not exciting, won't get rich quick, good over time. That is investing. Study, read and then maybe try investing in individual stocks.
5. what you are looking at when you see their dividend is there 'historical' dividend, this is the amount they paid out for the past year,, and most likely, they will not pay that out for the future year, when a stock is under as much pressure as RAD they most likely will save their money to pay off debts rather than pay out to investors, don't count n that dividend,,, if you are looking for some good articles on beginners investing,, you should check out www.thewallstreethunter.com they have some great ones on dividends.. Good luck