MSFT Dividend

Microsoft Corporation dividend

Although MSFT has a dividend of 0.91 with an ex-dividend date of Feb 19, you can sell covered calls on Microsoft Corporation 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):

Microsoft Corporation (MSFT)
Bid Ask Last Change Volume P/E Market Cap
477.95 478.00 478.53 -4.94 20.7M 34 3,593B

MSFT Dividend-Like Income Using Covered Calls

With MSFT at 478.53, 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% 14.36 3.9
5% 23.93 6.6
10% 47.85 13.1

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 MSFT Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Dec 19 477.50 6.40 8 73.8 0.00 (0.0%)
Dec 26 477.50 8.40 15 52.7 0.00 (0.0%)
5% Yield On MSFT Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Dec 19 477.50 6.40 8 73.8 0.00 (0.0%)
Dec 26 477.50 8.40 15 52.7 0.00 (0.0%)
10% Yield On MSFT Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Dec 19 477.50 6.40 8 73.8 0.00 (0.0%)
Dec 26 477.50 8.40 15 52.7 0.00 (0.0%)

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