PACW Dividend

PacWest Bancorp dividend

Although PACW has a dividend of 0.60 with an ex-dividend date of Feb 19, you can sell covered calls on PacWest Bancorp 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):

PacWest Bancorp (PACW)
Bid Ask Last Change Volume P/E Market Cap
40.70 41.88 41.13 +0.85 970K 12 5.0B

PACW Dividend-Like Income Using Covered Calls

With PACW at 41.13, 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% 1.23 0.3
5% 2.06 0.6
10% 4.11 1.1

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 PACW Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Jun 21 45.00 0.50 127 0.4 3.12 (7.6%)
Sep 20 45.00 0.95 218 0.4 3.12 (7.6%)

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Want more examples? PACB Dividend | PAF Dividend