IDT Dividend Type Payments

IDT Corporation Class B dividend

Although IDT has no upcoming (meaning, Board-approved and announced) dividends, you can sell covered calls on IDT Corporation Class B 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):

IDT Corporation Class B (IDT)
Bid Ask Last Change Volume P/E Market Cap
22.53 58.18 56.31 -0.53 161K 15 1.4B

IDT Dividend-Like Income Using Covered Calls

With IDT at 56.31, 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% 1.69 0.5
5% 2.82 0.8
10% 5.63 1.5

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 IDT Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Oct 17 60.00 2.00 92 2.2 1.82 (3.2%)
Sep 19 65.00 0.30 64 0.5 6.82 (12.1%)
5% Yield On IDT Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Oct 17 60.00 2.00 92 2.2 1.82 (3.2%)
Dec 19 60.00 2.20 155 1.4 1.82 (3.2%)
10% Yield On IDT Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Oct 17 60.00 2.00 92 2.2 1.82 (3.2%)
Nov 21 60.00 2.55 127 2.0 1.82 (3.2%)

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