BIDU Dividend Type Payments

Baidu, Inc. - American Depositary Shares, each representing 8 ordinary s dividend

Although BIDU has no upcoming (meaning, Board-approved and announced) dividends, you can sell covered calls on Baidu, Inc. - American Depositary Shares, each representing 8 ordinary s to create 12 extra dividend type payments per year to boost its yield. Let's look at some recent prices (last updated Thu 10:25 AM ET):

Baidu, Inc. - American Depositary Shares, each representing 8 ordinary s (BIDU)
Bid Ask Last Change Volume P/E Market Cap
83.43 83.49 83.43 -1.03 750K 89 30B

BIDU Dividend-Like Income Using Covered Calls

With BIDU at 83.43, 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% 2.50 0.7
5% 4.17 1.1
10% 8.34 2.3

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 BIDU Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Dec 6 100.00 0.47 23 2.0 16.51 (19.8%)
Dec 13 100.00 0.80 30 2.7 16.51 (19.8%)
5% Yield On BIDU Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Dec 6 100.00 0.47 23 2.0 16.51 (19.8%)
Dec 13 100.00 0.80 30 2.7 16.51 (19.8%)
10% Yield On BIDU Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Dec 6 84.00 3.85 23 16.7 0.51 (0.6%)
Dec 13 100.00 0.80 30 2.7 16.51 (19.8%)

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