AMBA Dividend Type Payments
Although AMBA has no upcoming (meaning, Board-approved and announced) dividends, you can sell covered calls on Ambarella, Inc. - Ordinary Shares to create 12 extra dividend type payments per year to boost its yield. Let's look at some recent prices (last updated Fri 4:16 PM ET):
| Ambarella, Inc. - Ordinary Shares (AMBA) |
|---|
| Bid |
Ask |
Last |
Change |
Volume |
P/E |
Market Cap |
| 76.00 |
78.50 |
78.20 |
-3.07 |
512K |
- |
3.4B |
AMBA Dividend-Like Income Using Covered Calls
With AMBA at 78.20, 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% |
2.35 |
0.6 |
| 5% |
3.91 |
1.1 |
| 10% |
7.82 |
2.1 |
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 AMBA Using Covered Calls |
|---|
| Expiration |
Strike |
Call Bid |
Days |
Cents/Day |
Upside Potential |
| Mar 7 |
100.00 |
0.60 |
15 |
4.0 |
21.50 (27.5%) |
| Mar 14 |
100.00 |
1.10 |
22 |
5.0 |
21.50 (27.5%) |
| 5% Yield On AMBA Using Covered Calls |
|---|
| Expiration |
Strike |
Call Bid |
Days |
Cents/Day |
Upside Potential |
| Mar 7 |
100.00 |
0.60 |
15 |
4.0 |
21.50 (27.5%) |
| Mar 14 |
100.00 |
1.10 |
22 |
5.0 |
21.50 (27.5%) |
| 10% Yield On AMBA Using Covered Calls |
|---|
| Expiration |
Strike |
Call Bid |
Days |
Cents/Day |
Upside Potential |
| Mar 7 |
100.00 |
0.60 |
15 |
4.0 |
21.50 (27.5%) |
| Mar 14 |
100.00 |
1.10 |
22 |
5.0 |
21.50 (27.5%) |
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