DPZ Dividend

DOMINOS PIZZA dividend

Although DPZ has a dividend of 0.55 with an ex-dividend date of Dec 13, you can sell covered calls on DOMINOS PIZZA 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):

DOMINOS PIZZA (DPZ)
Bid Ask Last Change Volume P/E Market Cap
260.84 274.56 267.75 +1.37 774K 33 11B

DPZ Dividend-Like Income Using Covered Calls

With DPZ at 267.75, 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% 8.03 2.2
5% 13.39 3.7
10% 26.78 7.3

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 DPZ Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Nov 16 290.00 1.45 29 5.0 15.44 (5.8%)
Dec 21 300.00 2.00 64 3.1 25.44 (9.5%)
5% Yield On DPZ Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Nov 16 290.00 1.45 29 5.0 15.44 (5.8%)
Dec 21 290.00 3.60 64 5.6 15.44 (5.8%)
10% Yield On DPZ Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Nov 16 280.00 3.20 29 11.0 5.44 (2.0%)
Dec 21 280.00 6.30 64 9.8 5.44 (2.0%)

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