WHD Dividend Type Payments

Although WHD has no upcoming (meaning, Board-approved and announced) dividends, you can sell covered calls on Cactus, 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 Mon 4:16 PM ET):

Cactus, Inc. Class A (WHD)
Bid Ask Last Change Volume P/E Market Cap
35.10 39.43 37.25 +0.64 502K 14 2.9B

WHD Dividend-Like Income Using Covered Calls

With WHD at 37.25, 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% 1.12 0.3
5% 1.86 0.5
10% 3.73 1.0

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 WHD Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Dec 19 40.00 1.00 61 1.6 0.57 (1.5%)
Nov 21 40.00 0.55 33 1.7 0.57 (1.5%)
5% Yield On WHD Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Dec 19 40.00 1.00 61 1.6 0.57 (1.5%)
Nov 21 40.00 0.55 33 1.7 0.57 (1.5%)
10% Yield On WHD Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Dec 19 40.00 1.00 61 1.6 0.57 (1.5%)
Nov 21 40.00 0.55 33 1.7 0.57 (1.5%)

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Want more examples? WH Dividend | WHG Dividend