FFIN Dividend

FIRST FINANCIAL BANKSHARES dividend

Although FFIN has a dividend of 0.21 with an ex-dividend date of Sep 14, you can sell covered calls on FIRST FINANCIAL BANKSHARES 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):

FIRST FINANCIAL BANKSHARES (FFIN)
Bid Ask Last Change Volume P/E Market Cap
59.70 59.70 59.70 +0.95 158K 29 4.0B

FFIN Dividend-Like Income Using Covered Calls

With FFIN at 59.70, 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% 1.79 0.5
5% 2.99 0.8
10% 5.97 1.6

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 FFIN Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Sep 21 60.00 0.25 37 0.7 0.30 (0.5%)
Oct 19 60.00 0.85 65 1.3 0.30 (0.5%)
5% Yield On FFIN Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Oct 19 60.00 0.85 65 1.3 0.30 (0.5%)
Jan 18 60.00 1.85 156 1.2 0.30 (0.5%)

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