ARCO Dividend
Although ARCO has a dividend of 0.06 with an ex-dividend date of Jun 24, you can sell covered calls on Arcos Dorados Holdings Inc. Class A Shares 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):
| Arcos Dorados Holdings Inc. Class A Shares (ARCO) | ||||||
|---|---|---|---|---|---|---|
| Bid | Ask | Last | Change | Volume | P/E | Market Cap |
| 6.88 | 8.56 | 7.46 | +0.45 | 6.2M | - | 1.5B |
ARCO Dividend-Like Income Using Covered Calls
With ARCO at 7.46, 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% | 0.22 | 0.1 |
| 5% | 0.37 | 0.1 |
| 10% | 0.75 | 0.2 |
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 ARCO Using Covered Calls | ||||||
|---|---|---|---|---|---|---|
| Expiration | Strike | Call Bid | Days | Cents/Day | Upside Potential | |
| Aug 15 | 10.00 | 0.10 | 121 | 0.1 | 1.44 (19.3%) | |
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| Top 10 Open Interest For May 16 Expiration | Top 5 High Yield | |||||
|---|---|---|---|---|---|---|
| 1. | NVDA dividend | 6. | IWM dividend | 1. | STLA dividend | |
| 2. | SPY dividend | 7. | GLD dividend | 2. | UPST dividend | |
| 3. | TLT dividend | 8. | FXI dividend | 3. | NBIS dividend | |
| 4. | SLV dividend | 9. | TSLA dividend | 4. | HOOD dividend | |
| 5. | QQQ dividend | 10. | INTC dividend | 5. | RIOT dividend | |
Want more examples? ARCC Dividend | ARCT Dividend
