VIA Dividend

VIACOM INC CL A dividend

Although VIA has a dividend of 0.20 with an ex-dividend date of Sep 14, you can sell covered calls on VIACOM INC CL A 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):

VIACOM INC CL A (VIA)
Bid Ask Last Change Volume P/E Market Cap
33.00 37.50 35.70 +0.35 42K 7.1 12B

VIA Dividend-Like Income Using Covered Calls

With VIA at 35.70, 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% 1.07 0.3
5% 1.79 0.5
10% 3.57 1.0

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 VIA Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Dec 21 40.00 0.65 127 0.5 2.50 (7.0%)
Mar 15 40.00 1.15 211 0.5 2.50 (7.0%)
5% Yield On VIA Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Dec 21 40.00 0.65 127 0.5 2.50 (7.0%)
Mar 15 40.00 1.15 211 0.5 2.50 (7.0%)

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