BBW Dividend

Although BBW has a dividend of 0.20 with an ex-dividend date of Nov 27, you can sell covered calls on Build-A-Bear Workshop, Inc. to create 12 extra dividend type payments per year to boost its yield. Let's look at some recent prices (last updated Tue 1:05 PM ET):

Build-A-Bear Workshop, Inc. (BBW)
Bid	Ask	Last	Change	Volume	P/E	Market Cap
36.58	36.73	36.58	-0.51	61K	11	0.5B

BBW Dividend-Like Income Using Covered Calls

With BBW at 36.58, 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%	1.10	0.3
5%	1.83	0.5
10%	3.66	1.0

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 BBW Using Covered Calls
Expiration	Strike	Call Bid	Days	Cents/Day	Upside Potential
Dec 20	37.50	2.30	32	7.2	0.77 (2.1%)
Jan 17	37.50	2.80	60	4.7	0.77 (2.1%)

5% Yield On BBW Using Covered Calls
Expiration	Strike	Call Bid	Days	Cents/Day	Upside Potential
Dec 20	37.50	2.30	32	7.2	0.77 (2.1%)
Jan 17	37.50	2.80	60	4.7	0.77 (2.1%)

10% Yield On BBW Using Covered Calls
Expiration	Strike	Call Bid	Days	Cents/Day	Upside Potential
Dec 20	37.50	2.30	32	7.2	0.77 (2.1%)
Jan 17	37.50	2.80	60	4.7	0.77 (2.1%)

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