IIIN Dividend

INSTEEL INDUSTRIES dividend

Although IIIN has a dividend of 0.03 with an ex-dividend date of Sep 13, you can sell covered calls on INSTEEL INDUSTRIES to create 12 extra dividend type payments per year to boost its yield. Let's look at some recent prices (last updated Wed 2:40 PM ET):

INSTEEL INDUSTRIES (IIIN)
Bid Ask Last Change Volume P/E Market Cap
40.87 41.00 40.99 -1.33 55K 26 0.8B

IIIN Dividend-Like Income Using Covered Calls

With IIIN at 40.99, 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% 1.23 0.3
5% 2.05 0.6
10% 4.10 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 IIIN Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Sep 21 45.00 0.25 38 0.7 4.00 (9.8%)
Oct 19 45.00 0.95 66 1.4 4.00 (9.8%)
5% Yield On IIIN Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Sep 21 45.00 0.25 38 0.7 4.00 (9.8%)
Oct 19 45.00 0.95 66 1.4 4.00 (9.8%)
10% Yield On IIIN Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Oct 19 45.00 0.95 66 1.4 4.00 (9.8%)
Jan 18 45.00 2.20 157 1.4 4.00 (9.8%)

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