SNAP Dividend Type Payments
Although SNAP has no upcoming (meaning, Board-approved and announced) dividends, you can sell covered calls on Snap Inc. Class A to create 12 extra dividend type payments per year to boost its yield. Let's look at some recent prices (last updated Mon 2:55 PM ET):
Snap Inc. Class A (SNAP) |
Bid |
Ask |
Last |
Change |
Volume |
P/E |
Market Cap |
14.59 |
14.60 |
14.59 |
+0.04 |
35.9M |
- |
24B |
SNAP Dividend-Like Income Using Covered Calls
With SNAP at 14.59, 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% |
0.44 |
0.1 |
5% |
0.73 |
0.2 |
10% |
1.46 |
0.4 |
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 SNAP Using Covered Calls |
Expiration |
Strike |
Call Bid |
Days |
Cents/Day |
Upside Potential |
May 3 |
15.00 |
0.29 |
5 |
5.8 |
0.40 (2.7%) |
Jun 7 |
15.00 |
0.86 |
40 |
2.2 |
0.40 (2.7%) |
5% Yield On SNAP Using Covered Calls |
Expiration |
Strike |
Call Bid |
Days |
Cents/Day |
Upside Potential |
May 3 |
15.00 |
0.29 |
5 |
5.8 |
0.40 (2.7%) |
Jun 7 |
15.00 |
0.86 |
40 |
2.2 |
0.40 (2.7%) |
10% Yield On SNAP Using Covered Calls |
Expiration |
Strike |
Call Bid |
Days |
Cents/Day |
Upside Potential |
May 3 |
15.00 |
0.29 |
5 |
5.8 |
0.40 (2.7%) |
Jun 7 |
15.00 |
0.86 |
40 |
2.2 |
0.40 (2.7%) |
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