KMB Dividend

Although KMB has a dividend of 1.26 with an ex-dividend date of Jun 6, you can sell covered calls on Kimberly-Clark Corporation to create 12 extra dividend type payments per year to boost its yield. Let's look at some recent prices (last updated Tue 1:45 PM ET):

Kimberly-Clark Corporation (KMB)
Bid	Ask	Last	Change	Volume	P/E	Market Cap
142.06	142.15	142.13	+0.58	862K	19	47B

KMB Dividend-Like Income Using Covered Calls

With KMB at 142.13, 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%	4.26	1.2
5%	7.11	1.9
10%	14.21	3.9

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 KMB Using Covered Calls
Expiration	Strike	Call Bid	Days	Cents/Day	Upside Potential
Jul 3	142.00	1.35	38	3.2	0.00 (0.0%)
Jun 6	142.00	1.25	11	10.0	0.00 (0.0%)

5% Yield On KMB Using Covered Calls
Expiration	Strike	Call Bid	Days	Cents/Day	Upside Potential
Jul 3	142.00	1.35	38	3.2	0.00 (0.0%)
Jun 6	142.00	1.25	11	10.0	0.00 (0.0%)

10% Yield On KMB Using Covered Calls
Expiration	Strike	Call Bid	Days	Cents/Day	Upside Potential
Jun 6	142.00	1.25	11	10.0	0.00 (0.0%)
Jun 13	142.00	1.85	18	9.4	0.00 (0.0%)

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