CTB Dividend

COOPER TIRE & RUBBER dividend

Although CTB has a dividend of 0.11 with an ex-dividend date of Aug 31, you can sell covered calls on COOPER TIRE & RUBBER 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):

COOPER TIRE & RUBBER (CTB)
Bid Ask Last Change Volume P/E Market Cap
29.65 30.15 29.75 +0.25 477K 35 1.5B

CTB Dividend-Like Income Using Covered Calls

With CTB at 29.75, 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% 0.89 0.2
5% 1.49 0.4
10% 2.98 0.8

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 CTB Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Sep 21 33.00 0.10 36 0.3 2.85 (9.6%)
Nov 16 35.00 0.35 92 0.4 4.85 (16.3%)
5% Yield On CTB Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Sep 21 32.00 0.20 36 0.6 1.85 (6.2%)
Nov 16 34.00 0.50 92 0.5 3.85 (12.9%)
10% Yield On CTB Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Sep 21 31.00 0.45 36 1.3 0.85 (2.9%)
Nov 16 32.00 0.95 92 1.0 1.85 (6.2%)

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Want more examples? CTAS Dividend | CTBI Dividend