TD Dividend Type Payments

Toronto Dominion Bank (The) dividend

Although TD has no upcoming (meaning, Board-approved and announced) dividends, you can sell covered calls on Toronto Dominion Bank (The) to create 12 extra dividend type payments per year to boost its yield. Let's look at some recent prices (last updated Tue 4:16 PM ET):

Toronto Dominion Bank (The) (TD)
Bid Ask Last Change Volume P/E Market Cap
95.00 95.89 95.49 +0.97 1.9M 12 174B

TD Dividend-Like Income Using Covered Calls

With TD at 95.49, 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% 2.86 0.8
5% 4.77 1.3
10% 9.55 2.6

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 TD Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Apr 17 100.00 1.55 74 2.1 4.11 (4.3%)
Jul 17 100.00 3.00 165 1.8 4.11 (4.3%)
5% Yield On TD Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Apr 17 100.00 1.55 74 2.1 4.11 (4.3%)
Jul 17 100.00 3.00 165 1.8 4.11 (4.3%)
10% Yield On TD Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Apr 17 97.50 2.50 74 3.4 1.61 (1.7%)
Feb 20 97.50 0.65 18 3.6 1.61 (1.7%)

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