VALE Dividend Type Payments

VALE S.A. American Depositary Shares Each Representing one common share dividend

Although VALE has no upcoming (meaning, Board-approved and announced) dividends, you can sell covered calls on VALE S.A. American Depositary Shares Each Representing one common share 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):

VALE S.A. American Depositary Shares Each Representing one common share (VALE)
Bid Ask Last Change Volume P/E Market Cap
12.29 12.31 12.28 +0.22 21.4M 6.4 38B

VALE Dividend-Like Income Using Covered Calls

With VALE at 12.28, 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% 0.37 0.1
5% 0.61 0.2
10% 1.23 0.3

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 VALE Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
May 3 12.50 0.09 8 1.1 0.19 (1.5%)
May 10 12.50 0.17 15 1.1 0.19 (1.5%)
5% Yield On VALE Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
May 3 12.50 0.09 8 1.1 0.19 (1.5%)
May 10 12.50 0.17 15 1.1 0.19 (1.5%)
10% Yield On VALE Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
May 3 12.50 0.09 8 1.1 0.19 (1.5%)
May 10 12.50 0.17 15 1.1 0.19 (1.5%)

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