LOCO Dividend Type Payments

El Pollo Loco Holdings, Inc dividend

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

El Pollo Loco Holdings, Inc (LOCO)
Bid Ask Last Change Volume P/E Market Cap
10.07 10.34 10.26 -0.08 259K -37.5 0.4B

LOCO Dividend-Like Income Using Covered Calls

With LOCO at 10.26, 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% 0.31 0.1
5% 0.51 0.1
10% 1.03 0.3

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 LOCO Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Aug 16 11.00 0.20 29 0.7 0.66 (6.4%)
Sep 20 12.00 0.10 64 0.2 1.66 (16.2%)
5% Yield On LOCO Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Aug 16 11.00 0.20 29 0.7 0.66 (6.4%)
Sep 20 12.00 0.10 64 0.2 1.66 (16.2%)
10% Yield On LOCO Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Aug 16 11.00 0.20 29 0.7 0.66 (6.4%)
Sep 20 11.00 0.35 64 0.5 0.66 (6.4%)

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