HON Dividend Type Payments

HONEYWELL INTL dividend

Although HON has no upcoming (meaning, Board-approved and announced) dividends, you can sell covered calls on HONEYWELL INTL 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):

HONEYWELL INTL (HON)
Bid Ask Last Change Volume P/E Market Cap
151.66 155.43 154.10 +1.67 2.0M 68 114B

HON Dividend-Like Income Using Covered Calls

With HON at 154.10, 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% 4.62 1.3
5% 7.71 2.1
10% 15.41 4.2

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 HON Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Aug 24 157.50 0.15 9 1.7 2.07 (1.3%)
Aug 31 157.50 0.43 16 2.7 2.07 (1.3%)
5% Yield On HON Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Aug 24 155.00 0.79 9 4.0 0.00 (0.0%)
Aug 31 157.50 0.43 16 2.7 2.07 (1.3%)
10% Yield On HON Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Aug 31 155.00 1.27 16 5.3 0.00 (0.0%)
Sep 7 155.00 1.60 23 5.1 0.00 (0.0%)

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