WH Dividend
Although WH has a dividend of 0.25 with an ex-dividend date of Dec 13, you can sell covered calls on Wyndham Hotels & Resorts, Inc to create 12 extra dividend type payments per year to boost its yield. Let's look at some recent prices (last updated Wed 4:16 PM ET):
| Wyndham Hotels & Resorts, Inc (WH) |
|---|
| Bid |
Ask |
Last |
Change |
Volume |
P/E |
Market Cap |
| 45.00 |
49.67 |
48.62 |
+0.76 |
730K |
- |
0.0B |
WH Dividend-Like Income Using Covered Calls
With WH at 48.62, 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% |
1.46 |
0.4 |
| 5% |
2.43 |
0.7 |
| 10% |
4.86 |
1.3 |
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 WH Using Covered Calls |
|---|
| Expiration |
Strike |
Call Bid |
Days |
Cents/Day |
Upside Potential |
| Dec 21 |
50.00 |
0.30 |
10 |
3.0 |
0.33 (0.7%) |
| Jan 18 |
52.50 |
0.40 |
38 |
1.1 |
2.83 (5.8%) |
| 5% Yield On WH Using Covered Calls |
|---|
| Expiration |
Strike |
Call Bid |
Days |
Cents/Day |
Upside Potential |
| Dec 21 |
50.00 |
0.30 |
10 |
3.0 |
0.33 (0.7%) |
| Jan 18 |
52.50 |
0.40 |
38 |
1.1 |
2.83 (5.8%) |
| 10% Yield On WH Using Covered Calls |
|---|
| Expiration |
Strike |
Call Bid |
Days |
Cents/Day |
Upside Potential |
| Dec 21 |
50.00 |
0.30 |
10 |
3.0 |
0.33 (0.7%) |
| Jan 18 |
50.00 |
1.20 |
38 |
3.2 |
0.33 (0.7%) |
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