PEN Dividend Type Payments
Although PEN has no upcoming (meaning, Board-approved and announced) dividends, you can sell covered calls on Penumbra, 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):
| Penumbra, Inc. (PEN) |
|---|
| Bid |
Ask |
Last |
Change |
Volume |
P/E |
Market Cap |
| 226.04 |
247.14 |
237.84 |
+4.33 |
373K |
272 |
9.0B |
PEN Dividend-Like Income Using Covered Calls
With PEN at 237.84, 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% |
7.14 |
2.0 |
| 5% |
11.89 |
3.3 |
| 10% |
23.78 |
6.5 |
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 PEN Using Covered Calls |
|---|
| Expiration |
Strike |
Call Bid |
Days |
Cents/Day |
Upside Potential |
| Dec 20 |
250.00 |
6.30 |
36 |
17.5 |
2.86 (1.2%) |
| Jan 17 |
250.00 |
8.60 |
64 |
13.4 |
2.86 (1.2%) |
| 5% Yield On PEN Using Covered Calls |
|---|
| Expiration |
Strike |
Call Bid |
Days |
Cents/Day |
Upside Potential |
| Dec 20 |
250.00 |
6.30 |
36 |
17.5 |
2.86 (1.2%) |
| Jan 17 |
250.00 |
8.60 |
64 |
13.4 |
2.86 (1.2%) |
| 10% Yield On PEN Using Covered Calls |
|---|
| Expiration |
Strike |
Call Bid |
Days |
Cents/Day |
Upside Potential |
| Dec 20 |
250.00 |
6.30 |
36 |
17.5 |
2.86 (1.2%) |
| Jan 17 |
250.00 |
8.60 |
64 |
13.4 |
2.86 (1.2%) |
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