AI Dividend Type Payments

C3.ai, Inc. Class A dividend

Although AI has no upcoming (meaning, Board-approved and announced) dividends, you can sell covered calls on C3.ai, 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 Tue 4:16 PM ET):

C3.ai, Inc. Class A (AI)
Bid Ask Last Change Volume P/E Market Cap
13.96 14.10 14.02 -0.60 3.8M - 2.1B

AI Dividend-Like Income Using Covered Calls

With AI at 14.02, 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% 0.42 0.1
5% 0.70 0.2
10% 1.40 0.4

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 AI Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Dec 26 14.50 0.06 4 1.5 0.40 (2.9%)
Jan 2 14.50 0.22 11 2.0 0.40 (2.9%)
5% Yield On AI Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Dec 26 14.50 0.06 4 1.5 0.40 (2.9%)
Jan 2 14.50 0.22 11 2.0 0.40 (2.9%)
10% Yield On AI Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Dec 26 14.50 0.06 4 1.5 0.40 (2.9%)
Jan 2 14.50 0.22 11 2.0 0.40 (2.9%)

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