What is Dividend yield?
Dividend yield is a company's yearly dividend per share divided by its share price, shown as a percentage. A stock paying $2 a year at a price of $50 has a 4% yield. Because price is in the bottom of the fraction, the yield rises when the share price falls, even if nothing about the dividend has changed.
Why Dividend yield matters
A very high yield can mean the market expects the dividend to be cut, so the number alone is not a measure of quality.