How much do I need to invest in Harvey Norman shares for $1,000 a year in passive income?

Young boy wearing suit and glasses counts his money using a calculator.Young boy wearing suit and glasses counts his money using a calculator.

The recent pullback in Harvey Norman Holdings Ltd (ASX: HVN) shares could provide an opportune entry point for passive income investors.

Shares in the S&P/ASX 200 Index (ASX: XJO) retail stock have come under some pressure amid investor angst over a possible recession.

A recession could see sales slow down further if consumers delay the purchase of some big-ticket discretionary items, like TVs, computers, or that new sofa.

Since reporting a decrease in sales on 27 February, Harvey Norman shares are down more than 13%, currently trading for $3.61 apiece.

But as I said, longer term, this pullback could mean ASX 200 investors buying shares today will be earning a lot more passive income tomorrow.

So, just how much would you have to invest in Harvey Norman shares for $1,000 in passive income?

How many Harvey Norman shares would yield $1,000 in passive income?

The ASX 200 retailer has a lengthy track record of delivering two fully franked dividends each year.

Now, before we dive into how many Harvey Norman shares will deliver that handy $1,000 of passive income, do take note that the yields we’re discussing are trailing yields. These are based on the dividend payments of the past 12 months. Future yields may be higher or lower, depending on a range of company-specific and wider macroeconomic factors.

With that said, Harvey Norman paid out a final dividend of 17.5 cents per share on 14 November. The interim dividend of 13 cents per share hit investors’ bank accounts on 1 May.

That works out to a full-year dividend payout of 30.5 cents per share. At the current Harvey Norman share price, that equates to a trailing yield of 8.4%, fully franked.

To garner my $1,000 in passive income I’d need to buy 3,279 Harvey Norman shares. Or $11,903 worth.

Now I likely won’t make that full investment all in one go.

But that’s okay.

Investing is a long game.

If I invest $500 a month, or whatever I’m able to set aside, I’ll get to my passive income goal eventually.

The post How much do I need to invest in Harvey Norman shares for $1,000 a year in passive income? appeared first on The Motley Fool Australia.

Should you invest $1,000 in Harvey Norman Holdings Limited right now?

Before you consider Harvey Norman Holdings Limited, you’ll want to hear this.

Motley Fool Investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now… and Harvey Norman Holdings Limited wasn’t one of them.

The online investing service he’s run for over a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more.* And right now, Scott thinks there are 5 stocks that are better buys.

See The 5 Stocks
*Returns as of April 3 2023

(function() {
function setButtonColorDefaults(param, property, defaultValue) {
if( !param || !param.includes(‘#’)) {
var button = document.getElementsByClassName(“pitch-snippet”)[0].getElementsByClassName(“pitch-button”)[0];[property] = defaultValue;

setButtonColorDefaults(“#43B02A”, ‘background’, ‘#5FA85D’);
setButtonColorDefaults(“#43B02A”, ‘border-color’, ‘#43A24A’);
setButtonColorDefaults(“#fff”, ‘color’, ‘#fff’);

More reading

Motley Fool contributor Bernd Struben has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Harvey Norman. The Motley Fool Australia has positions in and has recommended Harvey Norman. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

from The Motley Fool Australia

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s