JNJ Dividend Type Payments

Johnson & Johnson dividend

Although JNJ has no upcoming (meaning, Board-approved and announced) dividends, you can sell covered calls on Johnson & Johnson 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):

Johnson & Johnson (JNJ)
Bid Ask Last Change Volume P/E Market Cap
211.72 212.00 211.58 +1.57 6.8M 20 506B

JNJ Dividend-Like Income Using Covered Calls

With JNJ at 211.58, 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% 6.35 1.7
5% 10.58 2.9
10% 21.16 5.8

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 JNJ Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Dec 19 212.50 1.75 8 21.9 0.50 (0.2%)
Dec 26 212.50 2.27 15 15.1 0.50 (0.2%)
5% Yield On JNJ Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Dec 19 212.50 1.75 8 21.9 0.50 (0.2%)
Dec 26 212.50 2.27 15 15.1 0.50 (0.2%)
10% Yield On JNJ Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Dec 19 212.50 1.75 8 21.9 0.50 (0.2%)
Dec 26 212.50 2.27 15 15.1 0.50 (0.2%)

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