AON Dividend

AON dividend

Although AON has a dividend of 0.40 with an ex-dividend date of Oct 31, you can sell covered calls on AON 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):

AON (AON)
Bid Ask Last Change Volume P/E Market Cap
150.43 150.44 150.46 +0.61 748K 45 36B

AON Dividend-Like Income Using Covered Calls

With AON at 150.46, 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% 4.51 1.2
5% 7.52 2.1
10% 15.05 4.1

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 AON Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Oct 19 150.00 1.00 3 18.7 0.00 (0.0%)
Nov 16 160.00 0.45 31 1.5 9.56 (6.4%)
5% Yield On AON Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Oct 19 150.00 1.00 3 18.7 0.00 (0.0%)
Nov 16 155.00 1.45 31 4.7 4.56 (3.0%)
10% Yield On AON Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Oct 19 150.00 1.00 3 18.7 0.00 (0.0%)
Nov 16 155.00 1.45 31 4.7 4.56 (3.0%)

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Want more examples? AOM Dividend | AOR Dividend