MRO Dividend Type Payments

MARATHON OIL dividend

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

MARATHON OIL (MRO)
Bid Ask Last Change Volume P/E Market Cap
20.50 20.94 20.89 -0.29 9.5M - 18B

MRO Dividend-Like Income Using Covered Calls

With MRO at 20.89, 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% 0.63 0.2
5% 1.04 0.3
10% 2.09 0.6

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 MRO Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Oct 19 22.00 0.02 3 0.7 1.06 (5.1%)
Oct 26 23.50 0.02 10 0.2 2.56 (12.3%)
5% Yield On MRO Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Oct 19 22.00 0.02 3 0.7 1.06 (5.1%)
Oct 26 23.00 0.04 10 0.4 2.06 (9.9%)
10% Yield On MRO Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Oct 19 22.00 0.02 3 0.7 1.06 (5.1%)
Oct 26 22.50 0.08 10 0.8 1.56 (7.5%)

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Want more examples? MRNS Dividend | MRRL Dividend