CFR Dividend Type Payments

Cullen/Frost Bankers, Inc. dividend

Although CFR has no upcoming (meaning, Board-approved and announced) dividends, you can sell covered calls on Cullen/Frost Bankers, Inc. 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):

Cullen/Frost Bankers, Inc. (CFR)
Bid Ask Last Change Volume P/E Market Cap
125.80 132.61 132.61 -3.07 561K 17 8.7B

CFR Dividend-Like Income Using Covered Calls

With CFR at 132.61, 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% 3.98 1.1
5% 6.63 1.8
10% 13.26 3.6

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 CFR Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Jan 17 135.00 0.30 8 3.8 2.39 (1.8%)
Apr 17 135.00 6.00 98 6.1 2.39 (1.8%)
5% Yield On CFR Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Jan 17 135.00 0.30 8 3.8 2.39 (1.8%)
Apr 17 135.00 6.00 98 6.1 2.39 (1.8%)
10% Yield On CFR Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Jan 17 135.00 0.30 8 3.8 2.39 (1.8%)
Apr 17 135.00 6.00 98 6.1 2.39 (1.8%)

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