NVDA Dividend Type Payments

NVIDIA dividend

Although NVDA has no upcoming (meaning, Board-approved and announced) dividends, you can sell covered calls on NVIDIA to create 12 extra dividend type payments per year to boost its yield. Let's look at some recent prices (last updated Tue 9:35 AM ET):

NVIDIA (NVDA)
Bid Ask Last Change Volume P/E Market Cap
238.80 238.98 238.80 +3.42 625K 33 143B

NVDA Dividend-Like Income Using Covered Calls

With NVDA at 238.80, 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% 7.16 2.0
5% 11.94 3.3
10% 23.88 6.5

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 NVDA Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Oct 19 260.00 0.10 4 2.5 21.02 (8.8%)
Oct 26 267.50 0.29 11 2.6 28.52 (11.9%)
5% Yield On NVDA Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Oct 19 257.50 0.17 4 4.3 18.52 (7.8%)
Oct 26 265.00 0.42 11 3.8 26.02 (10.9%)
10% Yield On NVDA Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Oct 19 252.50 0.41 4 10.3 13.52 (5.7%)
Oct 26 260.00 0.80 11 7.3 21.02 (8.8%)

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