AEO Dividend Type Payments
Although AEO has no upcoming (meaning, Board-approved and announced) dividends, you can sell covered calls on American Eagle Outfitters, Inc. to create 12 extra dividend type payments per year to boost its yield. Let's look at some recent prices (last updated Thu 10:25 AM ET):
| American Eagle Outfitters, Inc. (AEO) | ||||||
|---|---|---|---|---|---|---|
| Bid | Ask | Last | Change | Volume | P/E | Market Cap |
| 12.77 | 12.78 | 12.78 | -0.74 | 5.5M | 14 | 4.9B |
AEO Dividend-Like Income Using Covered Calls
With AEO at 12.78, here's a table showing how big the annual "dividend" (i.e. total annual call premium received) would need to be to attain 3%, 5%, and 10% annual yields. Also shown is the equivalent number of cents/day necessary to achieve each yield:
| Annual Yield | Annual Premium | Cents/Day |
|---|---|---|
| 3% | 0.38 | 0.1 |
| 5% | 0.64 | 0.2 |
| 10% | 1.28 | 0.4 |
So now we need to find out of the money covered calls that pay at least the prescribed cents/day amount of time premium. That will generate income and, because they are out of the money, leave room for some upside potential on the stock. Here are some examples:
| 3% Yield On AEO Using Covered Calls | ||||||
|---|---|---|---|---|---|---|
| Expiration | Strike | Call Bid | Days | Cents/Day | Upside Potential | |
| Sep 5 | 13.00 | 1.00 | 23 | 4.3 | 0.22 (1.7%) | |
| Sep 12 | 13.00 | 1.10 | 30 | 3.7 | 0.22 (1.7%) | |
| 5% Yield On AEO Using Covered Calls | ||||||
|---|---|---|---|---|---|---|
| Expiration | Strike | Call Bid | Days | Cents/Day | Upside Potential | |
| Sep 5 | 13.00 | 1.00 | 23 | 4.3 | 0.22 (1.7%) | |
| Sep 12 | 13.00 | 1.10 | 30 | 3.7 | 0.22 (1.7%) | |
| 10% Yield On AEO Using Covered Calls | ||||||
|---|---|---|---|---|---|---|
| Expiration | Strike | Call Bid | Days | Cents/Day | Upside Potential | |
| Sep 5 | 13.00 | 1.00 | 23 | 4.3 | 0.22 (1.7%) | |
| Sep 12 | 13.00 | 1.10 | 30 | 3.7 | 0.22 (1.7%) | |
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| Top 10 Open Interest For Aug 15 Expiration | Top 5 High Yield | |||||
|---|---|---|---|---|---|---|
| 1. | NVDA dividend | 6. | GLD dividend | 1. | RCAT dividend | |
| 2. | SLV dividend | 7. | INTC dividend | 2. | SGML dividend | |
| 3. | SPY dividend | 8. | IBIT dividend | 3. | QUBT dividend | |
| 4. | TSLA dividend | 9. | AMZN dividend | 4. | ABR dividend | |
| 5. | IWM dividend | 10. | QQQ dividend | 5. | MBX dividend | |
Want more examples? AEM Dividend | AEP Dividend
