Here's How Many Shares of Domino's Pizza You'd Need to Own to Get $1,000 in Yearly Dividends

Companies can reward their shareholders by distributing some of their profits to them as dividends, and many investors like receiving them. If you're on the hunt for attractive dividend-paying stocks to buy now, you might consider Domino's Pizza (NYSE: DPZ), which has boosted its payouts for a dozen straight years.

How many shares of Domino's Pizza would you need to own to receive $1,000 in annual dividends? The math is pretty simple.

Image source: Getty Images.

Doing the math

Domino's currently pays a quarterly dividend of $1.51 a share. While its board of directors has a track record of increasing those payouts -- indeed, they are up by more than 600% since 2012 -- in the interest of making conservative calculations, let's assume that the distributions will stay constant from here. That works out to $6.04 a year.

Dividing $1,000 by $6.04 equals about 166 shares. Domino's stock closed at about $465 on Dec. 10. Multiplying the 166 shares by $465 works out to a $77,190 investment.

Known for its reasonable prices, convenient locations, and fast delivery, Domino's has continued to open new restaurants at a reasonable pace despite its already massive footprint.

It has posted same-store sales increases for 30 straight years, and it's on track to do so again in 2024. In its fiscal third quarter, which ended on Sept. 8, comps increased 3% at U.S. restaurants and 0.8% internationally. Its earnings growth slowed, however. Operating income, after factoring out foreign exchange rate effects, grew by 5.7%.

If you're looking primarily for a stock that will provide you with a reliable income stream, you can find higher dividend yields than Domino's 1.3%. That's only slightly above the 1.2% average yield of the S&P 500 -- the benchmark large-cap index. However, given Domino's low 33% payout ratio, it can easily afford to continue raising its dividend payments.

Should you invest $1,000 in Domino's Pizza right now?

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Lawrence Rothman, CFA has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Domino's Pizza. The Motley Fool has a disclosure policy.