KMB Dividend

Although KMB has a dividend of 1.26 with an ex-dividend date of Dec 5, you can sell covered calls on Kimberly-Clark Corporation 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):

Kimberly-Clark Corporation (KMB)
Bid	Ask	Last	Change	Volume	P/E	Market Cap
108.29	108.52	108.29	+2.28	7.1M	18	35B

KMB Dividend-Like Income Using Covered Calls

With KMB at 108.29, 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%	3.25	0.9
5%	5.41	1.5
10%	10.83	3.0

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 KMB Using Covered Calls
Expiration	Strike	Call Bid	Days	Cents/Day	Upside Potential
Dec 5	108.00	1.70	10	11.8	0.00 (0.0%)
Dec 12	108.00	2.05	17	9.0	0.00 (0.0%)

5% Yield On KMB Using Covered Calls
Expiration	Strike	Call Bid	Days	Cents/Day	Upside Potential
Dec 5	108.00	1.70	10	11.8	0.00 (0.0%)
Dec 12	108.00	2.05	17	9.0	0.00 (0.0%)

10% Yield On KMB Using Covered Calls
Expiration	Strike	Call Bid	Days	Cents/Day	Upside Potential
Dec 5	108.00	1.70	10	11.8	0.00 (0.0%)
Dec 12	108.00	2.05	17	9.0	0.00 (0.0%)

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