HOOD Dividend Type Payments
Although HOOD has no upcoming (meaning, Board-approved and announced) dividends, you can sell covered calls on Robinhood Markets, 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 Tue 4:16 PM ET):
| Robinhood Markets, Inc. - Class A (HOOD) |
|---|
| Bid |
Ask |
Last |
Change |
Volume |
P/E |
Market Cap |
| 79.51 |
79.75 |
85.60 |
-0.96 |
30.9M |
36 |
78B |
HOOD Dividend-Like Income Using Covered Calls
With HOOD at 85.60, 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% |
2.57 |
0.7 |
| 5% |
4.28 |
1.2 |
| 10% |
8.56 |
2.3 |
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 HOOD Using Covered Calls |
|---|
| Expiration |
Strike |
Call Bid |
Days |
Cents/Day |
Upside Potential |
| Feb 13 |
80.00 |
7.55 |
4 |
188.8 |
0.25 (0.3%) |
| Feb 20 |
80.00 |
8.40 |
11 |
76.4 |
0.25 (0.3%) |
| 5% Yield On HOOD Using Covered Calls |
|---|
| Expiration |
Strike |
Call Bid |
Days |
Cents/Day |
Upside Potential |
| Feb 13 |
80.00 |
7.55 |
4 |
188.8 |
0.25 (0.3%) |
| Feb 20 |
80.00 |
8.40 |
11 |
76.4 |
0.25 (0.3%) |
| 10% Yield On HOOD Using Covered Calls |
|---|
| Expiration |
Strike |
Call Bid |
Days |
Cents/Day |
Upside Potential |
| Feb 13 |
80.00 |
7.55 |
4 |
188.8 |
0.25 (0.3%) |
| Feb 20 |
80.00 |
8.40 |
11 |
76.4 |
0.25 (0.3%) |
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