PEG Dividend

PUBLIC SERVICE ENTERPRISES dividend

Although PEG has a dividend of 0.45 with an ex-dividend date of Sep 6, you can sell covered calls on PUBLIC SERVICE ENTERPRISES to create 12 extra dividend type payments per year to boost its yield. Let's look at some recent prices (last updated Wed 4:16 PM ET):

PUBLIC SERVICE ENTERPRISES (PEG)
Bid Ask Last Change Volume P/E Market Cap
51.01 52.91 52.80 +0.77 4.0M 12 26B

PEG Dividend-Like Income Using Covered Calls

With PEG at 52.80, 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% 1.58 0.4
5% 2.64 0.7
10% 5.28 1.4

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 PEG Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Dec 21 55.00 0.90 129 0.7 2.09 (4.0%)
Mar 15 55.00 1.40 213 0.7 2.09 (4.0%)

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Want more examples? PEBO Dividend | PEGA Dividend