MOMO Dividend
Although MOMO has a dividend of 0.30 with an ex-dividend date of Apr 11, you can sell covered calls on Hello Group Inc. - American Depositary Shares to create 12 extra dividend type payments per year to boost its yield. Let's look at some recent prices (last updated Tue 11:10 AM ET):
| Hello Group Inc. - American Depositary Shares (MOMO) |
|---|
| Bid |
Ask |
Last |
Change |
Volume |
P/E |
Market Cap |
| 7.02 |
7.03 |
7.03 |
-0.12 |
320K |
15 |
0.0B |
MOMO Dividend-Like Income Using Covered Calls
With MOMO at 7.03, 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% |
0.21 |
0.1 |
| 5% |
0.35 |
0.1 |
| 10% |
0.70 |
0.2 |
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 MOMO Using Covered Calls |
|---|
| Expiration |
Strike |
Call Bid |
Days |
Cents/Day |
Upside Potential |
| Apr 17 |
7.00 |
0.40 |
31 |
1.2 |
0.00 (0.0%) |
| Oct 17 |
10.00 |
0.35 |
214 |
0.2 |
2.97 (42.2%) |
| 5% Yield On MOMO Using Covered Calls |
|---|
| Expiration |
Strike |
Call Bid |
Days |
Cents/Day |
Upside Potential |
| Apr 17 |
7.00 |
0.40 |
31 |
1.2 |
0.00 (0.0%) |
| Oct 17 |
10.00 |
0.35 |
214 |
0.2 |
2.97 (42.2%) |
| 10% Yield On MOMO Using Covered Calls |
|---|
| Expiration |
Strike |
Call Bid |
Days |
Cents/Day |
Upside Potential |
| Apr 17 |
7.00 |
0.40 |
31 |
1.2 |
0.00 (0.0%) |
| Oct 17 |
7.00 |
1.15 |
214 |
0.5 |
0.00 (0.0%) |
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