KALU Dividend

Kaiser Aluminum Corporation dividend

Although KALU has a dividend of 0.77 with an ex-dividend date of Apr 25, you can sell covered calls on Kaiser Aluminum Corporation to create 12 extra dividend type payments per year to boost its yield. Let's look at some recent prices (last updated Wed 12:45 PM ET):

Kaiser Aluminum Corporation (KALU)
Bid Ask Last Change Volume P/E Market Cap
57.53 58.01 57.79 +1.84 50K 20 0.9B

KALU Dividend-Like Income Using Covered Calls

With KALU at 57.79, 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% 1.73 0.5
5% 2.89 0.8
10% 5.78 1.6

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 KALU Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Sep 19 60.00 2.55 150 1.7 1.99 (3.4%)
Dec 19 60.00 3.80 241 1.6 1.99 (3.4%)
5% Yield On KALU Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Sep 19 60.00 2.55 150 1.7 1.99 (3.4%)
Dec 19 60.00 3.80 241 1.6 1.99 (3.4%)
10% Yield On KALU Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Sep 19 60.00 2.55 150 1.7 1.99 (3.4%)
Jun 20 60.00 2.10 59 3.6 1.99 (3.4%)

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