AMAT Dividend

APPLIED MATERIALS dividend

Although AMAT has a dividend of 0.20 with an ex-dividend date of Nov 21, you can sell covered calls on APPLIED MATERIALS to create 12 extra dividend type payments per year to boost its yield. Let's look at some recent prices (last updated Tue 4:16 PM ET):

APPLIED MATERIALS (AMAT)
Bid Ask Last Change Volume P/E Market Cap
35.66 35.76 35.77 +1.35 25.1M 11 34B

AMAT Dividend-Like Income Using Covered Calls

With AMAT at 35.77, here's a table showing how big the annual "dividend" (ie. 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% 1.07 0.3
5% 1.79 0.5
10% 3.58 1.0

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 AMAT Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Nov 23 38.00 0.02 4 0.5 2.24 (6.3%)
Nov 30 40.00 0.07 11 0.6 4.24 (11.9%)
5% Yield On AMAT Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Nov 23 38.00 0.02 4 0.5 2.24 (6.3%)
Nov 30 40.00 0.07 11 0.6 4.24 (11.9%)
10% Yield On AMAT Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Nov 23 37.50 0.04 4 1.0 1.74 (4.9%)
Nov 30 39.00 0.14 11 1.3 3.24 (9.1%)

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Top 10 Open Interest For Dec 21 Expiration     Top 5 High Yield
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Want more examples? AMAG Dividend | AMBA Dividend