AJG Dividend Type Payments

Although AJG has no upcoming (meaning, Board-approved and announced) dividends, you can sell covered calls on Arthur J. Gallagher & Co. to create 12 extra dividend type payments per year to boost its yield. Let's look at some recent prices (last updated Fri 4:16 PM ET):

Arthur J. Gallagher & Co. (AJG)
Bid	Ask	Last	Change	Volume	P/E	Market Cap
247.44	255.47	253.39	+0.75	3.5M	40	65B

AJG Dividend-Like Income Using Covered Calls

With AJG at 253.39, 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%	7.60	2.1
5%	12.67	3.5
10%	25.34	6.9

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 AJG Using Covered Calls
Expiration	Strike	Call Bid	Days	Cents/Day	Upside Potential
Jan 16	260.00	3.60	29	12.4	4.53 (1.8%)
Apr 17	260.00	12.10	120	10.1	4.53 (1.8%)

5% Yield On AJG Using Covered Calls
Expiration	Strike	Call Bid	Days	Cents/Day	Upside Potential
Jan 16	260.00	3.60	29	12.4	4.53 (1.8%)
Apr 17	260.00	12.10	120	10.1	4.53 (1.8%)

10% Yield On AJG Using Covered Calls
Expiration	Strike	Call Bid	Days	Cents/Day	Upside Potential
Jan 16	260.00	3.60	29	12.4	4.53 (1.8%)
Apr 17	260.00	12.10	120	10.1	4.53 (1.8%)

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