CM Dividend

Canadian Imperial Bank of Commerce dividend

Although CM has a dividend of 0.69 with an ex-dividend date of Dec 27, you can sell covered calls on Canadian Imperial Bank of Commerce to create 12 extra dividend type payments per year to boost its yield. Let's look at some recent prices (last updated Wed 4:16 PM ET):

Canadian Imperial Bank of Commerce (CM)
Bid Ask Last Change Volume P/E Market Cap
63.40 64.09 64.09 -1.67 1.2M 13 52B

CM Dividend-Like Income Using Covered Calls

With CM at 64.09, 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% 1.92 0.5
5% 3.20 0.9
10% 6.41 1.8

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 CM Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Dec 20 65.00 0.15 3 5.0 0.91 (1.4%)
Jan 17 65.00 0.60 31 1.9 0.91 (1.4%)
5% Yield On CM Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Dec 20 65.00 0.15 3 5.0 0.91 (1.4%)
Jan 17 65.00 0.60 31 1.9 0.91 (1.4%)
10% Yield On CM Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Dec 20 65.00 0.15 3 5.0 0.91 (1.4%)
Jan 17 65.00 0.60 31 1.9 0.91 (1.4%)

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