CARG Dividend Type Payments

Although CARG has no upcoming (meaning, Board-approved and announced) dividends, you can sell covered calls on CarGurus, 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 11:25 AM ET):

CarGurus, Inc. - Class A (CARG)
Bid Ask Last Change Volume P/E Market Cap
28.30 28.35 28.34 -0.16 99K 142 3.0B

CARG Dividend-Like Income Using Covered Calls

With CARG at 28.34, 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% 0.85 0.2
5% 1.42 0.4
10% 2.83 0.8

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 CARG Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Aug 15 29.00 2.85 110 2.6 0.65 (2.3%)
May 16 29.00 1.30 19 6.8 0.65 (2.3%)
5% Yield On CARG Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Aug 15 29.00 2.85 110 2.6 0.65 (2.3%)
May 16 29.00 1.30 19 6.8 0.65 (2.3%)
10% Yield On CARG Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Aug 15 29.00 2.85 110 2.6 0.65 (2.3%)
May 16 29.00 1.30 19 6.8 0.65 (2.3%)

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Want more examples? CARE Dividend | CARR Dividend