AQN Dividend
Although AQN has a dividend of 0.07 with an ex-dividend date of Dec 31, you can sell covered calls on Algonquin Power & Utilities Corp. Common Shares 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):
| Algonquin Power & Utilities Corp. Common Shares (AQN) |
|---|
| Bid |
Ask |
Last |
Change |
Volume |
P/E |
Market Cap |
| 4.77 |
5.00 |
4.82 |
0.00 |
4.2M |
- |
1.2B |
AQN Dividend-Like Income Using Covered Calls
With AQN at 4.82, 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% |
0.14 |
0.0 |
| 5% |
0.24 |
0.1 |
| 10% |
0.48 |
0.1 |
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 AQN Using Covered Calls |
|---|
| Expiration |
Strike |
Call Bid |
Days |
Cents/Day |
Upside Potential |
| Dec 20 |
5.00 |
0.05 |
33 |
0.2 |
0.00 (0.0%) |
| Jan 17 |
5.00 |
0.05 |
61 |
0.1 |
0.00 (0.0%) |
| 5% Yield On AQN Using Covered Calls |
|---|
| Expiration |
Strike |
Call Bid |
Days |
Cents/Day |
Upside Potential |
| Dec 20 |
5.00 |
0.05 |
33 |
0.2 |
0.00 (0.0%) |
| Jan 17 |
5.00 |
0.05 |
61 |
0.1 |
0.00 (0.0%) |
| 10% Yield On AQN Using Covered Calls |
|---|
| Expiration |
Strike |
Call Bid |
Days |
Cents/Day |
Upside Potential |
| Dec 20 |
5.00 |
0.05 |
33 |
0.2 |
0.00 (0.0%) |
| Apr 17 |
5.00 |
0.30 |
151 |
0.2 |
0.00 (0.0%) |
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