SNN Dividend
Although SNN has a dividend of 0.30 with an ex-dividend date of Oct 3, you can sell covered calls on Smith & Nephew SNATS, Inc. 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):
| Smith & Nephew SNATS, Inc. (SNN) | ||||||
|---|---|---|---|---|---|---|
| Bid | Ask | Last | Change | Volume | P/E | Market Cap |
| 35.25 | 35.98 | 35.42 | +0.14 | 497K | - | 23B |
SNN Dividend-Like Income Using Covered Calls
With SNN at 35.42, 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% | 1.06 | 0.3 |
| 5% | 1.77 | 0.5 |
| 10% | 3.54 | 1.0 |
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 SNN Using Covered Calls | ||||||
|---|---|---|---|---|---|---|
| Expiration | Strike | Call Bid | Days | Cents/Day | Upside Potential | |
| Mar 20 | 40.00 | 0.60 | 176 | 0.3 | 4.02 (11.3%) | |
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| Top 10 Open Interest For Oct 17 Expiration | Top 5 High Yield | |||||
|---|---|---|---|---|---|---|
| 1. | NVDA dividend | 6. | IWM dividend | 1. | SOC dividend | |
| 2. | SLV dividend | 7. | EEM dividend | 2. | ARCT dividend | |
| 3. | GLD dividend | 8. | FXI dividend | 3. | QBTS dividend | |
| 4. | IBIT dividend | 9. | PCG dividend | 4. | EOSE dividend | |
| 5. | SPY dividend | 10. | QQQ dividend | 5. | RGTI dividend | |
Want more examples? SNEX Dividend | SNOW Dividend
