JD Dividend Type Payments

JD.COM INC dividend

Although JD has no upcoming (meaning, Board-approved and announced) dividends, you can sell covered calls on JD.COM INC to create 12 extra dividend type payments per year to boost its yield. Let's look at some recent prices (last updated Mon 4:16 PM ET):

JD.COM INC (JD)
Bid Ask Last Change Volume P/E Market Cap
32.92 33.14 33.04 +0.82 15.6M 277 46B

JD Dividend-Like Income Using Covered Calls

With JD at 33.04, 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% 0.99 0.3
5% 1.65 0.5
10% 3.30 0.9

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 JD Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Aug 24 36.00 0.02 5 0.4 2.86 (8.7%)
Aug 31 37.00 0.04 12 0.3 3.86 (11.7%)
5% Yield On JD Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Aug 24 35.50 0.03 5 0.6 2.36 (7.1%)
Aug 31 36.00 0.07 12 0.6 2.86 (8.7%)
10% Yield On JD Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Aug 24 35.00 0.05 5 1.0 1.86 (5.6%)
Aug 31 35.50 0.11 12 0.9 2.36 (7.1%)

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