SNAP Dividend Type Payments
Although SNAP has no upcoming (meaning, Board-approved and announced) dividends, you can sell covered calls on Snap Inc. Class A to create 12 extra dividend type payments per year to boost its yield. Let's look at some recent prices (last updated Wed 12:55 PM ET):
Snap Inc. Class A (SNAP) |
Bid |
Ask |
Last |
Change |
Volume |
P/E |
Market Cap |
10.66 |
10.67 |
10.66 |
+0.10 |
10.0M |
- |
18B |
SNAP Dividend-Like Income Using Covered Calls
With SNAP at 10.66, 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% |
0.32 |
0.1 |
5% |
0.53 |
0.1 |
10% |
1.07 |
0.3 |
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 SNAP Using Covered Calls |
Expiration |
Strike |
Call Bid |
Days |
Cents/Day |
Upside Potential |
Feb 7 |
11.00 |
0.92 |
17 |
5.4 |
0.33 (3.1%) |
Feb 14 |
11.00 |
0.94 |
24 |
3.9 |
0.33 (3.1%) |
5% Yield On SNAP Using Covered Calls |
Expiration |
Strike |
Call Bid |
Days |
Cents/Day |
Upside Potential |
Feb 7 |
11.00 |
0.92 |
17 |
5.4 |
0.33 (3.1%) |
Feb 14 |
11.00 |
0.94 |
24 |
3.9 |
0.33 (3.1%) |
10% Yield On SNAP Using Covered Calls |
Expiration |
Strike |
Call Bid |
Days |
Cents/Day |
Upside Potential |
Feb 7 |
11.00 |
0.92 |
17 |
5.4 |
0.33 (3.1%) |
Feb 14 |
11.00 |
0.94 |
24 |
3.9 |
0.33 (3.1%) |
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