Want $1,000 in Dividend Income? Here’s How Much You’d Have to Invest in Pfizer Stock

Pfizer stock currently has a 5.9% dividend yield, making it an attractive target for income investors.

Pfizer (PFE -0.60%) stock has struggled over the past year, losing around 28% of its value. Its dividend payout, meanwhile, has continued to rise again and again. This combination has pushed the dividend yield up to nearly 6%.

Is this your chance to secure a generous income stream of dividends?

Earn $1,000 in dividend income with this strategy

With the current dividend yield at 5.9%, you would need to invest around $17,000 into Pfizer stock to earn $1,000 in annual income. If you wanted to earn $1,000 in monthly income, you’d need to invest roughly $200,000.

Don’t have that much to invest? Don’t worry. By starting with a smaller amount, you can gradually build up to earning $1,000 in passive income. There are two pathways to achieving this goal.

First, there’s a chance that Pfizer stock has significant upside from here. The company’s COVID-19 vaccine, Comirnaty, saw its sales fall faster than expected last quarter, dragging down overall results. Total sales, for instance, fell by 19% year over year. When excluding COVID-19 revenue, however, sales actually increased by 11%. This suggests that Pfizer’s core business is still strong despite a slowdown in COVID-19 vaccine demand. With a strong pipeline of potential new products, it’s possible that the market is overreacting to short-term headwinds.

Second, Pfizer stands a good chance of increasing its dividend further in the years to come. It already has 15 years of consecutive dividend raises under its belt. New product launches — like its upcoming oncology treatment, Padcev, which could contribute billions of dollars in new revenue — should help raise this payout further over the long term.

In combination, long-term share price appreciation and dividend raises could help a small initial investment grow into a sizable nest egg. It may take some patience, but it’s very possible to generate a $1,000 passive income stream using Pfizer stock.

Ryan Vanzo has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Pfizer. The Motley Fool has a disclosure policy.

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