T Dividend Type Payments

AT&T Inc. dividend

Although T has no upcoming (meaning, Board-approved and announced) dividends, you can sell covered calls on AT&T 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):

AT&T Inc. (T)
Bid Ask Last Change Volume P/E Market Cap
25.11 25.15 25.14 +0.52 80.3M 14 176B

T Dividend-Like Income Using Covered Calls

With T at 25.14, 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% 0.75 0.2
5% 1.26 0.3
10% 2.51 0.7

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 T Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Nov 7 25.50 0.32 15 2.1 0.35 (1.4%)
Nov 14 26.00 0.24 22 1.1 0.85 (3.4%)
5% Yield On T Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Nov 7 25.50 0.32 15 2.1 0.35 (1.4%)
Nov 14 26.00 0.24 22 1.1 0.85 (3.4%)
10% Yield On T Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Nov 7 25.50 0.32 15 2.1 0.35 (1.4%)
Nov 14 26.00 0.24 22 1.1 0.85 (3.4%)

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