CAT Dividend Type Payments
Although CAT has no upcoming (meaning, Board-approved and announced) dividends, you can sell covered calls on Caterpillar, Inc. 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):
Caterpillar, Inc. (CAT) | ||||||
---|---|---|---|---|---|---|
Bid | Ask | Last | Change | Volume | P/E | Market Cap |
269.80 | 269.88 | 269.52 | -4.75 | 1.7M | 17 | 140B |
CAT Dividend-Like Income Using Covered Calls
With CAT at 269.52, 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% | 8.09 | 2.2 |
5% | 13.48 | 3.7 |
10% | 26.95 | 7.4 |
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 CAT Using Covered Calls | ||||||
---|---|---|---|---|---|---|
Expiration | Strike | Call Bid | Days | Cents/Day | Upside Potential | |
Sep 29 | 270.00 | 2.87 | 4 | 71.8 | 0.12 (0.0%) | |
Oct 6 | 270.00 | 5.20 | 11 | 47.3 | 0.12 (0.0%) |
5% Yield On CAT Using Covered Calls | ||||||
---|---|---|---|---|---|---|
Expiration | Strike | Call Bid | Days | Cents/Day | Upside Potential | |
Sep 29 | 270.00 | 2.87 | 4 | 71.8 | 0.12 (0.0%) | |
Oct 6 | 270.00 | 5.20 | 11 | 47.3 | 0.12 (0.0%) |
10% Yield On CAT Using Covered Calls | ||||||
---|---|---|---|---|---|---|
Expiration | Strike | Call Bid | Days | Cents/Day | Upside Potential | |
Sep 29 | 270.00 | 2.87 | 4 | 71.8 | 0.12 (0.0%) | |
Oct 6 | 270.00 | 5.20 | 11 | 47.3 | 0.12 (0.0%) |
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Top 10 Open Interest For Oct 20 Expiration | Top 5 High Yield | |||||
---|---|---|---|---|---|---|
1. | SLV dividend | 6. | FXI dividend | 1. | SNDX dividend | |
2. | SPY dividend | 7. | EEM dividend | 2. | REPL dividend | |
3. | TLT dividend | 8. | AMZN dividend | 3. | DYN dividend | |
4. | QQQ dividend | 9. | HYG dividend | 4. | APLD dividend | |
5. | AAPL dividend | 10. | IWM dividend | 5. | AFRM dividend |
Want more examples? CASY Dividend | CATO Dividend