PNM Dividend

PNM RESOURCES dividend

Although PNM has a dividend of 0.27 with an ex-dividend date of Nov 1, you can sell covered calls on PNM RESOURCES 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):

PNM RESOURCES (PNM)
Bid Ask Last Change Volume P/E Market Cap
18.35 39.11 39.10 +0.17 258K 43 3.1B

PNM Dividend-Like Income Using Covered Calls

With PNM at 39.10, 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% 1.17 0.3
5% 1.96 0.5
10% 3.91 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 PNM Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Nov 16 40.00 0.40 31 1.3 0.89 (2.3%)
May 17 40.00 1.05 213 0.5 0.89 (2.3%)
5% Yield On PNM Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Nov 16 40.00 0.40 31 1.3 0.89 (2.3%)
10% Yield On PNM Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Nov 16 40.00 0.40 31 1.3 0.89 (2.3%)

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Want more examples? PNK Dividend | PNNT Dividend