STX Dividend

Seagate Tech dividend

Although STX has a dividend of 0.63 with an ex-dividend date of Dec 18, you can sell covered calls on Seagate Tech 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):

Seagate Tech (STX)
Bid Ask Last Change Volume P/E Market Cap
39.00 39.87 39.50 -0.31 2.7M - 0.0B

STX Dividend-Like Income Using Covered Calls

With STX at 39.50, 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% 1.19 0.3
5% 1.98 0.5
10% 3.95 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 STX Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Dec 14 42.50 0.02 4 0.5 2.63 (6.7%)
Dec 21 44.00 0.04 11 0.4 4.13 (10.5%)
5% Yield On STX Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Dec 14 42.00 0.06 4 1.5 2.13 (5.4%)
Dec 21 43.50 0.07 11 0.6 3.63 (9.2%)
10% Yield On STX Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Dec 14 42.00 0.06 4 1.5 2.13 (5.4%)
Dec 21 42.50 0.13 11 1.2 2.63 (6.7%)

Want to increase dividends with covered calls?  Sign Up For A Free Trial

 
Top 10 Open Interest For Dec 21 Expiration     Top 5 High Yield
1.DUST dividend 6.NSSC dividend   1. dividend
2.NOVT dividend 7.MOD dividend   2. dividend
3.MMS dividend 8.VV dividend   3. dividend
4.VSI dividend 9.EC dividend   4. dividend
5.DXJS dividend 10.NTWK dividend   5. dividend

Want more examples? STWD Dividend | STZ Dividend