BBBY Dividend Type Payments

Bed Bath & Beyond, Inc. dividend

Although BBBY has no upcoming (meaning, Board-approved and announced) dividends, you can sell covered calls on Bed Bath & Beyond, Inc. 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):

Bed Bath & Beyond, Inc. (BBBY)
Bid Ask Last Change Volume P/E Market Cap
5.46 5.70 5.56 +0.01 2.8M - 0.4B

BBBY Dividend-Like Income Using Covered Calls

With BBBY at 5.56, 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% 0.17 0.0
5% 0.28 0.1
10% 0.56 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 BBBY Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Dec 19 7.50 0.10 29 0.3 1.80 (32.4%)
Jan 16 10.00 0.10 57 0.2 4.30 (77.3%)
5% Yield On BBBY Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Dec 19 7.50 0.10 29 0.3 1.80 (32.4%)
Jan 16 10.00 0.10 57 0.2 4.30 (77.3%)
10% Yield On BBBY Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Dec 19 7.50 0.10 29 0.3 1.80 (32.4%)
Jan 16 10.00 0.10 57 0.2 4.30 (77.3%)

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Want more examples? BBAR Dividend | BBC Dividend