RCL Dividend
Although RCL has a dividend of 0.70 with an ex-dividend date of Mar 6, you can sell covered calls on Royal Caribbean Cruises 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):
| Royal Caribbean Cruises (RCL) | ||||||
|---|---|---|---|---|---|---|
| Bid | Ask | Last | Change | Volume | P/E | Market Cap |
| 115.50 | 118.25 | 117.97 | +0.75 | 1.3M | 14 | 25B |
RCL Dividend-Like Income Using Covered Calls
With RCL at 117.97, 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% | 3.54 | 1.0 |
| 5% | 5.90 | 1.6 |
| 10% | 11.80 | 3.2 |
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 RCL Using Covered Calls | ||||||
|---|---|---|---|---|---|---|
| Expiration | Strike | Call Bid | Days | Cents/Day | Upside Potential | |
| Feb 22 | 123.00 | 0.08 | 8 | 1.0 | 4.75 (4.0%) | |
| Mar 1 | 125.00 | 0.17 | 15 | 1.1 | 6.75 (5.7%) | |
| 5% Yield On RCL Using Covered Calls | ||||||
|---|---|---|---|---|---|---|
| Expiration | Strike | Call Bid | Days | Cents/Day | Upside Potential | |
| Feb 22 | 122.00 | 0.16 | 8 | 2.0 | 3.75 (3.2%) | |
| Mar 1 | 124.00 | 0.26 | 15 | 1.7 | 5.75 (4.9%) | |
| 10% Yield On RCL Using Covered Calls | ||||||
|---|---|---|---|---|---|---|
| Expiration | Strike | Call Bid | Days | Cents/Day | Upside Potential | |
| Feb 22 | 121.00 | 0.30 | 8 | 3.8 | 2.75 (2.3%) | |
| Mar 1 | 122.00 | 0.57 | 15 | 3.8 | 3.75 (3.2%) | |
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| Top 10 Open Interest For Mar 15 Expiration | Top 5 High Yield | |||||
|---|---|---|---|---|---|---|
| 1. | SPX dividend | 6. | EWZ dividend | 1. | ICPT dividend | |
| 2. | EEM dividend | 7. | GE dividend | 2. | ROKU dividend | |
| 3. | SPY dividend | 8. | XOP dividend | 3. | KPTI dividend | |
| 4. | FXI dividend | 9. | BAC dividend | 4. | BHC dividend | |
| 5. | QQQ dividend | 10. | JD dividend | 5. | VKTX dividend | |
Want more examples? RCKT Dividend | RCMT Dividend
