SWK Dividend Type Payments

Stanley Black & Decker, Inc. dividend

Although SWK has no upcoming (meaning, Board-approved and announced) dividends, you can sell covered calls on Stanley Black & Decker, 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):

Stanley Black & Decker, Inc. (SWK)
Bid Ask Last Change Volume P/E Market Cap
87.50 91.00 89.39 +3.82 2.7M 30 13B

SWK Dividend-Like Income Using Covered Calls

With SWK at 89.39, 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% 2.68 0.7
5% 4.47 1.2
10% 8.94 2.4

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 SWK Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Feb 20 92.50 1.25 15 8.3 1.50 (1.7%)
Mar 20 92.50 2.65 43 6.2 1.50 (1.7%)
5% Yield On SWK Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Feb 20 92.50 1.25 15 8.3 1.50 (1.7%)
Mar 20 92.50 2.65 43 6.2 1.50 (1.7%)
10% Yield On SWK Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Feb 20 92.50 1.25 15 8.3 1.50 (1.7%)
Mar 20 92.50 2.65 43 6.2 1.50 (1.7%)

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