MCK Dividend

Although MCK has a dividend of 0.82 with an ex-dividend date of Mar 2, you can sell covered calls on McKesson Corporation to create 12 extra dividend type payments per year to boost its yield. Let's look at some recent prices (last updated Thu 4:16 PM ET):

McKesson Corporation (MCK)
Bid	Ask	Last	Change	Volume	P/E	Market Cap
890.00	969.00	916.00	-37.19	1.5M	-	117B

MCK Dividend-Like Income Using Covered Calls

With MCK at 916.00, 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%	27.48	7.5
5%	45.80	12.5
10%	91.60	25.1

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 MCK Using Covered Calls
Expiration	Strike	Call Bid	Days	Cents/Day	Upside Potential
Feb 20	970.00	0.70	9	7.8	1.00 (0.1%)
Feb 27	970.00	1.25	16	7.8	1.00 (0.1%)

5% Yield On MCK Using Covered Calls
Expiration	Strike	Call Bid	Days	Cents/Day	Upside Potential
Mar 13	970.00	4.10	30	13.7	1.00 (0.1%)
Mar 20	970.00	6.50	37	17.6	1.00 (0.1%)

10% Yield On MCK Using Covered Calls
Expiration	Strike	Call Bid	Days	Cents/Day	Upside Potential
May 15	980.00	24.80	93	26.7	11.00 (1.2%)
Jun 18	980.00	32.90	127	25.9	11.00 (1.2%)

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Want more examples? MCHX Dividend | MCO Dividend