W Dividend Type Payments

Wayfair Inc. Class A dividend

Although W has no upcoming (meaning, Board-approved and announced) dividends, you can sell covered calls on Wayfair Inc. Class A to create 12 extra dividend type payments per year to boost its yield. Let's look at some recent prices (last updated Mon 2:00 PM ET):

Wayfair Inc. Class A (W)
Bid Ask Last Change Volume P/E Market Cap
100.70 100.82 100.75 -1.47 550K - 13B

W Dividend-Like Income Using Covered Calls

With W at 100.75, 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% 3.02 0.8
5% 5.04 1.4
10% 10.08 2.8

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 W Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Jan 2 101.00 1.81 5 36.2 0.18 (0.2%)
Feb 6 101.00 6.10 40 15.3 0.18 (0.2%)
5% Yield On W Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Jan 2 101.00 1.81 5 36.2 0.18 (0.2%)
Feb 6 101.00 6.10 40 15.3 0.18 (0.2%)
10% Yield On W Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Jan 2 101.00 1.81 5 36.2 0.18 (0.2%)
Feb 6 101.00 6.10 40 15.3 0.18 (0.2%)

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