SPSC Dividend Type Payments

SPS Commerce, Inc. dividend

Although SPSC has no upcoming (meaning, Board-approved and announced) dividends, you can sell covered calls on SPS Commerce, Inc. to create 12 extra dividend type payments per year to boost its yield. Let's look at some recent prices (last updated Tue 4:16 PM ET):

SPS Commerce, Inc. (SPSC)
Bid Ask Last Change Volume P/E Market Cap
105.72 153.45 134.36 -0.28 257K 63 5.1B

SPSC Dividend-Like Income Using Covered Calls

With SPSC at 134.36, 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% 4.03 1.1
5% 6.72 1.8
10% 13.44 3.7

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 SPSC Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Oct 17 155.00 2.70 123 2.2 1.55 (1.2%)
Jan 16 155.00 6.50 214 3.0 1.55 (1.2%)
5% Yield On SPSC Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Oct 17 155.00 2.70 123 2.2 1.55 (1.2%)
Jan 16 155.00 6.50 214 3.0 1.55 (1.2%)

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