WD Dividend Type Payments
Although WD has no upcoming (meaning, Board-approved and announced) dividends, you can sell covered calls on Walker & Dunlop, Inc to create 12 extra dividend type payments per year to boost its yield. Let's look at some recent prices (last updated Mon 4:16 PM ET):
Walker & Dunlop, Inc (WD) | ||||||
---|---|---|---|---|---|---|
Bid | Ask | Last | Change | Volume | P/E | Market Cap |
66.68 | 74.42 | 70.48 | -0.05 | 307K | 24 | 2.4B |
WD Dividend-Like Income Using Covered Calls
With WD at 70.48, 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% | 2.11 | 0.6 |
5% | 3.52 | 1.0 |
10% | 7.05 | 1.9 |
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 WD Using Covered Calls | ||||||
---|---|---|---|---|---|---|
Expiration | Strike | Call Bid | Days | Cents/Day | Upside Potential | |
Nov 21 | 75.00 | 1.25 | 145 | 0.9 | 0.58 (0.8%) | |
Feb 20 | 75.00 | 2.85 | 236 | 1.2 | 0.58 (0.8%) |
5% Yield On WD Using Covered Calls | ||||||
---|---|---|---|---|---|---|
Expiration | Strike | Call Bid | Days | Cents/Day | Upside Potential | |
Feb 20 | 75.00 | 2.85 | 236 | 1.2 | 0.58 (0.8%) |
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