FANG Dividend Type Payments

DIAMONDBACK ENERGY INC dividend

Although FANG has no upcoming (meaning, Board-approved and announced) dividends, you can sell covered calls on DIAMONDBACK ENERGY 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):

DIAMONDBACK ENERGY INC (FANG)
Bid Ask Last Change Volume P/E Market Cap
128.11 133.57 130.82 +2.89 1.2M 22 13B

FANG Dividend-Like Income Using Covered Calls

With FANG at 130.82, 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% 3.92 1.1
5% 6.54 1.8
10% 13.08 3.6

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 FANG Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Oct 19 140.00 0.05 4 1.3 6.43 (4.9%)
Nov 16 155.00 0.35 32 1.1 21.43 (16.4%)
5% Yield On FANG Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Oct 19 135.00 0.35 4 8.8 1.43 (1.1%)
Nov 16 150.00 0.60 32 1.9 16.43 (12.6%)
10% Yield On FANG Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Oct 19 135.00 0.35 4 8.8 1.43 (1.1%)
Nov 16 145.00 1.20 32 3.8 11.43 (8.7%)

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Top 10 Open Interest For Oct 19 Expiration     Top 5 High Yield
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Want more examples? FAN Dividend | FANH Dividend