BGS Dividend Type Payments

B&G FOODS dividend

Although BGS has no upcoming (meaning, Board-approved and announced) dividends, you can sell covered calls on B&G FOODS 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):

B&G FOODS (BGS)
Bid Ask Last Change Volume P/E Market Cap
25.00 30.00 27.34 +0.75 502K 9.2 1.8B

BGS Dividend-Like Income Using Covered Calls

With BGS at 27.34, 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% 0.82 0.2
5% 1.37 0.4
10% 2.73 0.7

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 BGS Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Nov 16 32.50 0.10 32 0.3 2.50 (9.1%)
Jan 18 32.50 0.25 95 0.3 2.50 (9.1%)
5% Yield On BGS Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Nov 16 30.00 0.45 32 1.4 0.00 (0.0%)
Jan 18 30.00 0.70 95 0.7 0.00 (0.0%)
10% Yield On BGS Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Nov 16 30.00 0.45 32 1.4 0.00 (0.0%)

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