in case Nvidia (Nasdaq: NVDA) The company was already unpopular among investors, and now the semiconductor giant is tempting income seekers with a quarterly dividend hike. The dividend won't be huge on a percentage basis, but Nvidia's cash payouts will be a nice reward for long-term shareholders.
Nvidia made another big announcement alongside the dividend increase, which may confuse some investors. Don't worry, though, because the upcoming changes won't reduce the incentive to buy and hold Nvidia stock.
Small return gets big increase
Amid a slew of positive data points for the first quarter of fiscal 2025, Nvidia's earnings increase announcement may have gotten lost in the shuffle for some investors. However, revenue takers shouldn't underestimate the importance of Nvidia's upcoming quarterly earnings increase.
To recap this announcement, Nvidia will increase its quarterly dividend per share by 150% from $0.04 to $0.10. There's still time to get in, as registered Nvidia shareholders on June 11 will be paid on June 28 (although depending on your broker, it may take a few extra days to see the cash payment appear in your account).
What about an Nvidia stock split?
This is all simple enough, but there's another simultaneous announcement from Nvidia that could complicate things. Specifically, Nvidia is splitting futures shares 10 for 1. If you were an Nvidia shareholder of record on June 6, you will receive an additional nine Nvidia shares after the market closes on June 7; Trading will begin on the adjusted split basis on June 10.
So, for example, Nvidia's stock price might be reduced from approximately $1,160 to $116. But what is known for sure is that the dividend increase will be $0.01 per share after the split instead of $0.10 per share.
A penny per share each quarter doesn't seem like much, and forward annual Profit return It will still be minimal (0.0034%). However, the quarterly per-share payment would be at least 150% better than $0.004, post-split, without increasing Nvidia's dividend.
Should you invest $1,000 in Nvidia now?
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David Modell He has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Nvidia. The Motley Fool has Disclosure policy.
What is the dividend on Nvidia stock? Originally published by The Motley Fool