LLY Dividend Type Payments

ELI LILLY dividend

Although LLY has no upcoming (meaning, Board-approved and announced) dividends, you can sell covered calls on ELI LILLY 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):

ELI LILLY (LLY)
Bid Ask Last Change Volume P/E Market Cap
110.27 117.00 115.81 +1.98 4.8M 242 121B

LLY Dividend-Like Income Using Covered Calls

With LLY at 115.81, 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% 3.47 1.0
5% 5.79 1.6
10% 11.58 3.2

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 LLY Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Nov 23 119.00 0.11 5 2.2 2.00 (1.7%)
Nov 30 122.00 0.17 12 1.4 5.00 (4.3%)
5% Yield On LLY Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Nov 23 119.00 0.11 5 2.2 2.00 (1.7%)
Nov 30 121.00 0.26 12 2.2 4.00 (3.5%)
10% Yield On LLY Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Nov 23 118.00 0.25 5 5.0 1.00 (0.9%)
Nov 30 120.00 0.39 12 3.3 3.00 (2.6%)

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