AJG Dividend

Although AJG has a dividend of 0.70 with an ex-dividend date of Mar 6, 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 Wed 4:16 PM ET):

Arthur J. Gallagher & Co. (AJG)
Bid	Ask	Last	Change	Volume	P/E	Market Cap
204.00	212.94	205.31	-7.27	4.4M	34	55B

AJG Dividend-Like Income Using Covered Calls

With AJG at 205.31, 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%	6.16	1.7
5%	10.27	2.8
10%	20.53	5.6

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
Feb 20	220.00	0.70	10	7.0	7.06 (3.4%)
Mar 20	220.00	4.10	38	10.8	7.06 (3.4%)

5% Yield On AJG Using Covered Calls
Expiration	Strike	Call Bid	Days	Cents/Day	Upside Potential
Feb 20	220.00	0.70	10	7.0	7.06 (3.4%)
Mar 20	220.00	4.10	38	10.8	7.06 (3.4%)

10% Yield On AJG Using Covered Calls
Expiration	Strike	Call Bid	Days	Cents/Day	Upside Potential
Feb 20	220.00	0.70	10	7.0	7.06 (3.4%)
Mar 20	220.00	4.10	38	10.8	7.06 (3.4%)

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