NKE Dividend

Nike, Inc dividend

Although NKE has a dividend of 0.22 with an ex-dividend date of May 31, you can sell covered calls on Nike, 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):

Nike, Inc (NKE)
Bid Ask Last Change Volume P/E Market Cap
82.11 82.95 82.16 -0.48 5.8M 32 130B

NKE Dividend-Like Income Using Covered Calls

With NKE at 82.16, 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% 2.46 0.7
5% 4.11 1.1
10% 8.22 2.3

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 NKE Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
May 31 85.00 0.06 8 0.8 2.05 (2.5%)
Jun 7 86.00 0.12 15 0.8 3.05 (3.7%)
5% Yield On NKE Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
May 31 84.50 0.11 8 1.4 1.55 (1.9%)
Jun 7 85.50 0.18 15 1.2 2.55 (3.1%)
10% Yield On NKE Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
May 31 83.50 0.29 8 3.6 0.55 (0.7%)
Jun 7 84.50 0.35 15 2.3 1.55 (1.9%)

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