PAHC Dividend
Although PAHC has a dividend of 0.12 with an ex-dividend date of Nov 26, you can sell covered calls on Phibro Animal Health Corporation - Class A to create 12 extra dividend type payments per year to boost its yield. Let's look at some recent prices (last updated Thu 10:55 AM ET):
| Phibro Animal Health Corporation - Class A (PAHC) |
|---|
| Bid |
Ask |
Last |
Change |
Volume |
P/E |
Market Cap |
| 43.80 |
44.52 |
43.91 |
-1.41 |
45K |
27 |
1.8B |
PAHC Dividend-Like Income Using Covered Calls
With PAHC at 43.91, here's a table showing how big the annual "dividend" (i.e. 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% |
1.32 |
0.4 |
| 5% |
2.20 |
0.6 |
| 10% |
4.39 |
1.2 |
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 PAHC Using Covered Calls |
|---|
| Expiration |
Strike |
Call Bid |
Days |
Cents/Day |
Upside Potential |
| Dec 19 |
45.00 |
1.30 |
37 |
3.5 |
0.48 (1.1%) |
| Nov 21 |
45.00 |
0.45 |
9 |
5.0 |
0.48 (1.1%) |
| 5% Yield On PAHC Using Covered Calls |
|---|
| Expiration |
Strike |
Call Bid |
Days |
Cents/Day |
Upside Potential |
| Dec 19 |
45.00 |
1.30 |
37 |
3.5 |
0.48 (1.1%) |
| Nov 21 |
45.00 |
0.45 |
9 |
5.0 |
0.48 (1.1%) |
| 10% Yield On PAHC Using Covered Calls |
|---|
| Expiration |
Strike |
Call Bid |
Days |
Cents/Day |
Upside Potential |
| Dec 19 |
45.00 |
1.30 |
37 |
3.5 |
0.48 (1.1%) |
| Nov 21 |
45.00 |
0.45 |
9 |
5.0 |
0.48 (1.1%) |
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