WUBA Dividend Type Payments

Although WUBA has no upcoming (meaning, Board-approved and announced) dividends, you can sell covered calls on 58. COM INC to create 12 extra dividend type payments per year to boost its yield. Let's look at some recent prices (last updated Thu 4:16 PM ET):

58. COM INC (WUBA)
Bid Ask Last Change Volume P/E Market Cap
60.46 61.75 61.71 -3.56 855K 41 10B

WUBA Dividend-Like Income Using Covered Calls

With WUBA at 61.71, 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% 1.85 0.5
5% 3.09 0.8
10% 6.17 1.7

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 WUBA Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Nov 16 80.00 0.20 30 0.7 18.25 (29.6%)
Jan 18 85.00 0.65 93 0.7 23.25 (37.7%)
5% Yield On WUBA Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Nov 16 75.00 0.55 30 1.8 13.25 (21.5%)
Jan 18 80.00 1.10 93 1.2 18.25 (29.6%)
10% Yield On WUBA Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Nov 16 75.00 0.55 30 1.8 13.25 (21.5%)
Jan 18 75.00 1.75 93 1.9 13.25 (21.5%)

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