BLUE Dividend Type Payments

BLUEBIRD BIO dividend

Although BLUE has no upcoming (meaning, Board-approved and announced) dividends, you can sell covered calls on BLUEBIRD BIO 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):

BLUEBIRD BIO (BLUE)
Bid Ask Last Change Volume P/E Market Cap
154.60 159.50 158.00 +1.80 343K - 8.5B

BLUE Dividend-Like Income Using Covered Calls

With BLUE at 158.00, 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% 4.74 1.3
5% 7.90 2.2
10% 15.80 4.3

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 BLUE Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Sep 21 190.00 0.50 36 1.4 30.50 (19.3%)
Nov 16 210.00 1.70 92 1.8 50.50 (32.0%)
5% Yield On BLUE Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Sep 21 185.00 0.90 36 2.5 25.50 (16.1%)
Nov 16 200.00 2.65 92 2.9 40.50 (25.6%)
10% Yield On BLUE Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Sep 21 175.00 2.25 36 6.3 15.50 (9.8%)
Nov 16 190.00 4.30 92 4.7 30.50 (19.3%)

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