USAC Dividend Type Payments

USA Compression Partners, LP Common Units Representing Limited Partner I dividend

Although USAC has no upcoming (meaning, Board-approved and announced) dividends, you can sell covered calls on USA Compression Partners, LP Common Units Representing Limited Partner I to create 12 extra dividend type payments per year to boost its yield. Let's look at some recent prices (last updated Thu 4:16 PM ET):

USA Compression Partners, LP Common Units Representing Limited Partner I (USAC)
Bid Ask Last Change Volume P/E Market Cap
23.49 25.37 24.70 +0.04 161K 36 2.9B

USAC Dividend-Like Income Using Covered Calls

With USAC at 24.70, 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% 0.74 0.2
5% 1.24 0.3
10% 2.47 0.7

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 USAC Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Jul 18 27.50 0.20 58 0.3 2.13 (8.6%)
Sep 19 27.50 0.50 121 0.4 2.13 (8.6%)
5% Yield On USAC Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Jul 18 27.50 0.20 58 0.3 2.13 (8.6%)
Sep 19 27.50 0.50 121 0.4 2.13 (8.6%)

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