LNG Dividend Type Payments

Cheniere Energy, Inc. dividend

Although LNG has no upcoming (meaning, Board-approved and announced) dividends, you can sell covered calls on Cheniere Energy, Inc. to create 12 extra dividend type payments per year to boost its yield. Let's look at some recent prices (last updated Tue 9:35 AM ET):

Cheniere Energy, Inc. (LNG)
Bid Ask Last Change Volume P/E Market Cap
215.38 216.51 215.99 +0.78 37K 12 46B

LNG Dividend-Like Income Using Covered Calls

With LNG at 215.99, 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% 6.48 1.8
5% 10.80 3.0
10% 21.60 5.9

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 LNG Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Dec 5 217.50 2.50 18 13.9 0.99 (0.5%)
Dec 12 220.00 4.00 25 16.0 3.49 (1.6%)
5% Yield On LNG Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Dec 5 217.50 2.50 18 13.9 0.99 (0.5%)
Dec 12 220.00 4.00 25 16.0 3.49 (1.6%)
10% Yield On LNG Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Dec 5 217.50 2.50 18 13.9 0.99 (0.5%)
Dec 12 220.00 4.00 25 16.0 3.49 (1.6%)

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