DUK Dividend Type Payments

Duke Energy dividend

Although DUK has no upcoming (meaning, Board-approved and announced) dividends, you can sell covered calls on Duke Energy to create 12 extra dividend type payments per year to boost its yield. Let's look at some recent prices (last updated Thu 4:16 PM ET):

Duke Energy (DUK)
Bid Ask Last Change Volume P/E Market Cap
88.06 90.30 89.91 +0.53 4.0M 24 65B

DUK Dividend-Like Income Using Covered Calls

With DUK at 89.91, 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% 2.70 0.7
5% 4.50 1.2
10% 8.99 2.5

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 DUK Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Apr 18 92.50 0.30 29 1.0 2.20 (2.4%)
May 17 92.50 0.80 58 1.4 2.20 (2.4%)
5% Yield On DUK Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Apr 18 90.00 1.20 29 3.1 0.00 (0.0%)
May 17 92.50 0.80 58 1.4 2.20 (2.4%)
10% Yield On DUK Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Apr 18 90.00 1.20 29 3.1 0.00 (0.0%)
May 17 90.00 1.85 58 2.7 0.00 (0.0%)

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