CVNA Dividend Type Payments
Although CVNA has no upcoming (meaning, Board-approved and announced) dividends, you can sell covered calls on Carvana Co. Class A to create 12 extra dividend type payments per year to boost its yield. Let's look at some recent prices (last updated Fri 3:55 PM ET):
| Carvana Co. Class A (CVNA) |
|---|
| Bid |
Ask |
Last |
Change |
Volume |
P/E |
Market Cap |
| 401.53 |
401.87 |
401.69 |
+2.84 |
2.0M |
91 |
87B |
CVNA Dividend-Like Income Using Covered Calls
With CVNA at 401.69, 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% |
12.05 |
3.3 |
| 5% |
20.08 |
5.5 |
| 10% |
40.17 |
11.0 |
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 CVNA Using Covered Calls |
|---|
| Expiration |
Strike |
Call Bid |
Days |
Cents/Day |
Upside Potential |
| Dec 12 |
400.00 |
13.50 |
8 |
145.4 |
0.00 (0.0%) |
| Dec 19 |
400.00 |
18.15 |
15 |
108.5 |
0.00 (0.0%) |
| 5% Yield On CVNA Using Covered Calls |
|---|
| Expiration |
Strike |
Call Bid |
Days |
Cents/Day |
Upside Potential |
| Dec 12 |
400.00 |
13.50 |
8 |
145.4 |
0.00 (0.0%) |
| Dec 19 |
400.00 |
18.15 |
15 |
108.5 |
0.00 (0.0%) |
| 10% Yield On CVNA Using Covered Calls |
|---|
| Expiration |
Strike |
Call Bid |
Days |
Cents/Day |
Upside Potential |
| Dec 12 |
400.00 |
13.50 |
8 |
145.4 |
0.00 (0.0%) |
| Dec 19 |
400.00 |
18.15 |
15 |
108.5 |
0.00 (0.0%) |
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