GDDY Dividend Type Payments
Although GDDY has no upcoming (meaning, Board-approved and announced) dividends, you can sell covered calls on GoDaddy Inc. 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 12:35 PM ET):
| GoDaddy Inc. Class A (GDDY) |
|---|
| Bid |
Ask |
Last |
Change |
Volume |
P/E |
Market Cap |
| 126.74 |
126.87 |
126.85 |
+0.18 |
518K |
22 |
17B |
GDDY Dividend-Like Income Using Covered Calls
With GDDY at 126.85, 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% |
3.81 |
1.0 |
| 5% |
6.34 |
1.7 |
| 10% |
12.69 |
3.5 |
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 GDDY Using Covered Calls |
|---|
| Expiration |
Strike |
Call Bid |
Days |
Cents/Day |
Upside Potential |
| Dec 26 |
127.00 |
1.00 |
8 |
12.5 |
0.13 (0.1%) |
| Jan 2 |
127.00 |
1.40 |
15 |
9.3 |
0.13 (0.1%) |
| 5% Yield On GDDY Using Covered Calls |
|---|
| Expiration |
Strike |
Call Bid |
Days |
Cents/Day |
Upside Potential |
| Dec 26 |
127.00 |
1.00 |
8 |
12.5 |
0.13 (0.1%) |
| Jan 2 |
127.00 |
1.40 |
15 |
9.3 |
0.13 (0.1%) |
| 10% Yield On GDDY Using Covered Calls |
|---|
| Expiration |
Strike |
Call Bid |
Days |
Cents/Day |
Upside Potential |
| Dec 26 |
127.00 |
1.00 |
8 |
12.5 |
0.13 (0.1%) |
| Jan 2 |
127.00 |
1.40 |
15 |
9.3 |
0.13 (0.1%) |
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