KTOS Dividend Type Payments

Kratos Defense & Security Solutions, Inc. dividend

Although KTOS has no upcoming (meaning, Board-approved and announced) dividends, you can sell covered calls on Kratos Defense & Security Solutions, Inc. 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):

Kratos Defense & Security Solutions, Inc. (KTOS)
Bid Ask Last Change Volume P/E Market Cap
77.89 78.33 77.88 +5.47 5.1M 557 12B

KTOS Dividend-Like Income Using Covered Calls

With KTOS at 77.88, 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% 2.34 0.6
5% 3.89 1.1
10% 7.79 2.1

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 KTOS Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Dec 5 101.00 0.60 29 2.1 22.67 (29.1%)
Dec 12 103.00 0.75 36 2.1 24.67 (31.7%)
5% Yield On KTOS Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Dec 5 101.00 0.60 29 2.1 22.67 (29.1%)
Dec 12 103.00 0.75 36 2.1 24.67 (31.7%)
10% Yield On KTOS Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Dec 5 78.00 6.00 29 19.6 0.00 (0.0%)
Dec 12 78.00 5.40 36 14.1 0.00 (0.0%)

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