BBSI Dividend

BARRETT BUSINESS SERVICES dividend

Although BBSI has a dividend of 0.25 with an ex-dividend date of Aug 23, you can sell covered calls on BARRETT BUSINESS SERVICES to create 12 extra dividend type payments per year to boost its yield. Let's look at some recent prices (last updated Tue 11:30 AM ET):

BARRETT BUSINESS SERVICES (BBSI)
Bid Ask Last Change Volume P/E Market Cap
75.73 76.43 75.82 +2.51 10K 20 0.5B

BBSI Dividend-Like Income Using Covered Calls

With BBSI at 75.82, 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% 2.27 0.6
5% 3.79 1.0
10% 7.58 2.1

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 BBSI Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Sep 21 85.00 0.35 39 0.9 8.57 (11.3%)
Nov 16 90.00 0.80 95 0.8 13.57 (17.9%)
5% Yield On BBSI Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Sep 21 80.00 0.90 39 2.3 3.57 (4.7%)
Nov 16 80.00 2.50 95 2.6 3.57 (4.7%)
10% Yield On BBSI Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Sep 21 80.00 0.90 39 2.3 3.57 (4.7%)
Nov 16 80.00 2.50 95 2.6 3.57 (4.7%)

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