Answer:
Next year's annual dividend divided by today's stock price
Explanation:
Dividend yield is a financial ratio which is used by investors to assess a company's annual dividend payout in comparison of its stock price. The formula for dividend yield ratio is :
Annual dividend / Stock price
The annual dividend used is the most recent dividend paid or is to be paid to shareholders of the company. It enables investors to assess the return on their investment in each stock price. Dividend yield increases when companies pay more dividends. It is a good signaling effect for shareholders.
