TWLO Dividend Type Payments
Although TWLO has no upcoming (meaning, Board-approved and announced) dividends, you can sell covered calls on Twilio 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 Tue 4:16 PM ET):
| Twilio Inc. Class A (TWLO) |
|---|
| Bid |
Ask |
Last |
Change |
Volume |
P/E |
Market Cap |
| 100.90 |
102.30 |
102.11 |
-2.37 |
2.7M |
950 |
17B |
TWLO Dividend-Like Income Using Covered Calls
With TWLO at 102.11, 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% |
3.06 |
0.8 |
| 5% |
5.11 |
1.4 |
| 10% |
10.21 |
2.8 |
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 TWLO Using Covered Calls |
|---|
| Expiration |
Strike |
Call Bid |
Days |
Cents/Day |
Upside Potential |
| Oct 3 |
102.00 |
3.90 |
18 |
20.0 |
0.00 (0.0%) |
| Oct 10 |
102.00 |
4.60 |
25 |
17.2 |
0.00 (0.0%) |
| 5% Yield On TWLO Using Covered Calls |
|---|
| Expiration |
Strike |
Call Bid |
Days |
Cents/Day |
Upside Potential |
| Oct 3 |
102.00 |
3.90 |
18 |
20.0 |
0.00 (0.0%) |
| Oct 10 |
102.00 |
4.60 |
25 |
17.2 |
0.00 (0.0%) |
| 10% Yield On TWLO Using Covered Calls |
|---|
| Expiration |
Strike |
Call Bid |
Days |
Cents/Day |
Upside Potential |
| Oct 3 |
102.00 |
3.90 |
18 |
20.0 |
0.00 (0.0%) |
| Oct 10 |
102.00 |
4.60 |
25 |
17.2 |
0.00 (0.0%) |
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