HTH Dividend

Hilltop Holdings Inc. dividend

Although HTH has a dividend of 0.20 with an ex-dividend date of Feb 13, you can sell covered calls on Hilltop Holdings Inc. to create 12 extra dividend type payments per year to boost its yield. Let's look at some recent prices (last updated Thu 11:05 AM ET):

Hilltop Holdings Inc. (HTH)
Bid Ask Last Change Volume P/E Market Cap
38.77 38.94 38.85 -0.26 59K 16 2.4B

HTH Dividend-Like Income Using Covered Calls

With HTH at 38.85, 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% 1.17 0.3
5% 1.94 0.5
10% 3.89 1.1

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 HTH Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
May 15 40.00 1.30 93 1.4 1.06 (2.7%)
5% Yield On HTH Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
May 15 40.00 1.30 93 1.4 1.06 (2.7%)
10% Yield On HTH Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
May 15 40.00 1.30 93 1.4 1.06 (2.7%)

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