WMT Dividend

WALMART INC dividend

Although WMT has a dividend of 0.52 with an ex-dividend date of Dec 6, you can sell covered calls on WALMART INC to create 12 extra dividend type payments per year to boost its yield. Let's look at some recent prices (last updated Mon 4:16 PM ET):

WALMART INC (WMT)
Bid Ask Last Change Volume P/E Market Cap
96.00 96.10 96.00 -1.85 12.3M 33 289B

WMT Dividend-Like Income Using Covered Calls

With WMT at 96.00, 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% 2.88 0.8
5% 4.80 1.3
10% 9.60 2.6

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 WMT Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Aug 24 100.00 0.05 5 1.0 3.90 (4.1%)
Aug 31 100.00 0.15 12 1.3 3.90 (4.1%)
5% Yield On WMT Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Aug 24 99.00 0.08 5 1.6 2.90 (3.0%)
Aug 31 99.00 0.25 12 2.1 2.90 (3.0%)
10% Yield On WMT Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Aug 24 98.00 0.16 5 3.2 1.90 (2.0%)
Aug 31 98.00 0.41 12 3.4 1.90 (2.0%)

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