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 Tue 4:16 PM ET):

AT&T Inc. (T)
Bid Ask Last Change Volume P/E Market Cap
15.02 15.03 15.02 -0.04 34.6M - 108B

T Dividend-Like Income Using Covered Calls

With T at 15.02, 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% 0.45 0.1
5% 0.75 0.2
10% 1.50 0.4

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 T Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Sep 29 15.00 0.16 4 3.3 0.00 (0.0%)
Oct 6 15.00 0.24 11 1.9 0.00 (0.0%)
5% Yield On T Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Sep 29 15.00 0.16 4 3.3 0.00 (0.0%)
Oct 6 15.00 0.24 11 1.9 0.00 (0.0%)
10% Yield On T Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Sep 29 15.00 0.16 4 3.3 0.00 (0.0%)
Oct 6 15.00 0.24 11 1.9 0.00 (0.0%)

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