Next, we take this amount and divide it by Dow's $1.40 dividend: $6,000 / $1.40 = 4,286 shares. The dividend yield is calculated by dividing the annual dividend payment by the current stock price. Further, the dividend payment itself can also change over time, which can also impact the dividend yield. If a company increases its dividend payment, the dividend yield will increase even if the stock price remains the same. Similarly, if a company decreases its dividend payment, the dividend yield will decrease.