TSQ Dividend
Although TSQ has a dividend of 0.20 with an ex-dividend date of Jan 26, you can sell covered calls on Townsquare Media, Inc. Class A 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):
| Townsquare Media, Inc. Class A (TSQ) |
|---|
| Bid |
Ask |
Last |
Change |
Volume |
P/E |
Market Cap |
| 4.72 |
4.90 |
4.73 |
+0.01 |
68K |
4.0 |
0.1B |
TSQ Dividend-Like Income Using Covered Calls
With TSQ at 4.73, 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% |
0.14 |
0.0 |
| 5% |
0.24 |
0.1 |
| 10% |
0.47 |
0.1 |
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 TSQ Using Covered Calls |
|---|
| Expiration |
Strike |
Call Bid |
Days |
Cents/Day |
Upside Potential |
| Dec 19 |
5.00 |
0.05 |
24 |
0.2 |
0.10 (2.1%) |
| Mar 20 |
5.00 |
0.20 |
115 |
0.2 |
0.10 (2.1%) |
| 5% Yield On TSQ Using Covered Calls |
|---|
| Expiration |
Strike |
Call Bid |
Days |
Cents/Day |
Upside Potential |
| Dec 19 |
5.00 |
0.05 |
24 |
0.2 |
0.10 (2.1%) |
| Mar 20 |
5.00 |
0.20 |
115 |
0.2 |
0.10 (2.1%) |
| 10% Yield On TSQ Using Covered Calls |
|---|
| Expiration |
Strike |
Call Bid |
Days |
Cents/Day |
Upside Potential |
| Dec 19 |
5.00 |
0.05 |
24 |
0.2 |
0.10 (2.1%) |
| Mar 20 |
5.00 |
0.20 |
115 |
0.2 |
0.10 (2.1%) |
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