NVO Dividend Type Payments

NOVO-NORDISK dividend

Although NVO has no upcoming (meaning, Board-approved and announced) dividends, you can sell covered calls on NOVO-NORDISK 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):

NOVO-NORDISK (NVO)
Bid Ask Last Change Volume P/E Market Cap
47.00 48.00 47.50 +0.50 1.5M 19 113B

NVO Dividend-Like Income Using Covered Calls

With NVO at 47.50, 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% 1.43 0.4
5% 2.38 0.7
10% 4.75 1.3

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 NVO Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Oct 19 49.00 0.30 30 1.0 1.00 (2.1%)
Dec 21 50.00 0.95 93 1.0 2.00 (4.2%)
5% Yield On NVO Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Oct 19 49.00 0.30 30 1.0 1.00 (2.1%)
Dec 21 50.00 0.95 93 1.0 2.00 (4.2%)
10% Yield On NVO Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Oct 19 48.00 0.60 30 2.0 0.00 (0.0%)
Dec 21 49.00 1.40 93 1.5 1.00 (2.1%)

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