TSN Dividend

Tyson Foods, Inc. dividend

Although TSN has a dividend of 0.51 with an ex-dividend date of Feb 27, you can sell covered calls on Tyson Foods, Inc. 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):

Tyson Foods, Inc. (TSN)
Bid Ask Last Change Volume P/E Market Cap
57.81 58.45 58.19 -1.34 2.6M 45 21B

TSN Dividend-Like Income Using Covered Calls

With TSN at 58.19, 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% 1.75 0.5
5% 2.91 0.8
10% 5.82 1.6

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 TSN Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Dec 19 60.00 0.05 4 1.3 1.55 (2.7%)
Jan 16 60.00 0.60 32 1.9 1.55 (2.7%)
5% Yield On TSN Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Dec 19 60.00 0.05 4 1.3 1.55 (2.7%)
Jan 16 60.00 0.60 32 1.9 1.55 (2.7%)
10% Yield On TSN Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Jan 16 60.00 0.60 32 1.9 1.55 (2.7%)
Mar 20 60.00 2.00 95 2.1 1.55 (2.7%)

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