AMSWA Dividend

American Software, Inc. - Class A dividend

Although AMSWA has a dividend of 0.11 with an ex-dividend date of May 2, you can sell covered calls on American Software, Inc. - Class A 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):

American Software, Inc. - Class A (AMSWA)
Bid Ask Last Change Volume P/E Market Cap
10.34 11.84 10.62 +0.05 232K 29 0.4B

AMSWA Dividend-Like Income Using Covered Calls

With AMSWA at 10.62, 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% 0.32 0.1
5% 0.53 0.1
10% 1.06 0.3

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 AMSWA Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Jul 19 12.50 0.10 92 0.1 0.66 (6.2%)
Oct 18 12.50 0.35 183 0.2 0.66 (6.2%)
5% Yield On AMSWA Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Oct 18 12.50 0.35 183 0.2 0.66 (6.2%)

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