JNJ Dividend

Although JNJ has a dividend of 1.24 with an ex-dividend date of Nov 26, 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
153.80	154.27	154.00	+2.13	11.1M	25	366B

JNJ Dividend-Like Income Using Covered Calls

With JNJ at 154.00, 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%	4.62	1.3
5%	7.70	2.1
10%	15.40	4.2

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 JNJ Using Covered Calls
Expiration	Strike	Call Bid	Days	Cents/Day	Upside Potential
Dec 6	155.00	1.47	22	6.7	0.73 (0.5%)
Dec 13	155.00	1.85	29	6.4	0.73 (0.5%)

5% Yield On JNJ Using Covered Calls
Expiration	Strike	Call Bid	Days	Cents/Day	Upside Potential
Dec 6	155.00	1.47	22	6.7	0.73 (0.5%)
Dec 13	155.00	1.85	29	6.4	0.73 (0.5%)

10% Yield On JNJ Using Covered Calls
Expiration	Strike	Call Bid	Days	Cents/Day	Upside Potential
Dec 6	155.00	1.47	22	6.7	0.73 (0.5%)
Dec 13	155.00	1.85	29	6.4	0.73 (0.5%)

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Want more examples? JMOM Dividend | JNK Dividend