NMIH Dividend Type Payments

NMI Holdings, Inc CL A dividend

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

NMI Holdings, Inc CL A (NMIH)
Bid Ask Last Change Volume P/E Market Cap
18.59 19.45 18.56 -0.22 297K - 0.0B

NMIH Dividend-Like Income Using Covered Calls

With NMIH at 18.56, 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% 0.56 0.2
5% 0.93 0.3
10% 1.86 0.5

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 NMIH Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Mar 15 20.00 0.70 93 0.8 0.55 (3.0%)
Jun 21 20.00 1.05 191 0.5 0.55 (3.0%)
5% Yield On NMIH Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Mar 15 20.00 0.70 93 0.8 0.55 (3.0%)
Jun 21 20.00 1.05 191 0.5 0.55 (3.0%)
10% Yield On NMIH Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Mar 15 20.00 0.70 93 0.8 0.55 (3.0%)
Jun 21 20.00 1.05 191 0.5 0.55 (3.0%)

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