ARM Dividend Type Payments

Arm Holdings plc - American Depositary Shares dividend

Although ARM has no upcoming (meaning, Board-approved and announced) dividends, you can sell covered calls on Arm Holdings plc - American Depositary Shares to create 12 extra dividend type payments per year to boost its yield. Let's look at some recent prices (last updated Fri 4:16 PM ET):

Arm Holdings plc - American Depositary Shares (ARM)
Bid Ask Last Change Volume P/E Market Cap
138.60 139.40 138.91 -1.64 3.4M - 0.0B

ARM Dividend-Like Income Using Covered Calls

With ARM at 138.91, 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% 4.17 1.1
5% 6.95 1.9
10% 13.89 3.8

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 ARM Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Sep 5 140.00 5.20 22 23.6 0.60 (0.4%)
Sep 12 140.00 6.15 29 21.2 0.60 (0.4%)
5% Yield On ARM Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Sep 5 140.00 5.20 22 23.6 0.60 (0.4%)
Sep 12 140.00 6.15 29 21.2 0.60 (0.4%)
10% Yield On ARM Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Sep 5 140.00 5.20 22 23.6 0.60 (0.4%)
Sep 12 140.00 6.15 29 21.2 0.60 (0.4%)

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