Dividend stocks for covered calls
22 tracked tickers paid at least 2% a year at the September 30, 2026 snapshot, led by MO at 6.3%. Writing calls against a dividend payer stacks two income streams on the same 100 shares, and introduces one specific way to lose the shares early that a non-payer does not have.
| Ticker | Price | Dividend yield | Best call annualized | Ex-div in window | ATM IV |
|---|---|---|---|---|---|
| MOAltria Group | $68.15 | 6.3% | none | not in this window | 25% |
| VZVerizon Communications | $45.89 | 6.1% | none | yes | 28% |
| PFEPfizer Inc. | $28.62 | 6.0% | 8.5% | not in this window | 24% |
| FFord Motor Company | $12.25 | 4.9% | 22.0% | not in this window | 39% |
| NKENike Inc. | $35.78 | 4.6% | 49.3% | not in this window | 50% |
| TAT&T Inc. | $24.54 | 4.5% | 13.3% | not in this window | 29% |
| PEPPepsiCo Inc. | $128.86 | 4.5% | 18.3% | not in this window | 24% |
| KMIKinder Morgan | $30.33 | 3.9% | none | not in this window | 29% |
| CVXChevron Corporation | $204.94 | 3.4% | 11.0% | not in this window | 28% |
| HDThe Home Depot | $287.15 | 3.2% | none | not in this window | 25% |
| NEENextEra Energy | $75.99 | 3.2% | none | not in this window | 24% |
| IBMInternational Business Machines | $220.45 | 3.1% | 25.9% | not in this window | 45% |
| PGProcter and Gamble | $147.62 | 2.9% | none | not in this window | 24% |
| SBUXStarbucks Corporation | $95.30 | 2.6% | 15.7% | not in this window | 32% |
| ABBVAbbVie Inc. | $263.47 | 2.6% | none | yes | 29% |
| XOMExxon Mobil | $162.92 | 2.5% | 12.6% | not in this window | 30% |
| UNHUnitedHealth Group | $367.85 | 2.5% | 29.8% | not in this window | 40% |
| KOThe Coca-Cola Company | $87.11 | 2.4% | 11.7% | not in this window | 21% |
| SLBSLB (Schlumberger) | $49.40 | 2.4% | 18.5% | not in this window | 39% |
| MRKMerck and Co. | $147.35 | 2.3% | 15.6% | not in this window | 38% |
| WFCWells Fargo | $80.59 | 2.3% | 17.3% | not in this window | 32% |
| BACBank of America | $54.84 | 2.1% | 17.1% | not in this window | 28% |
The early assignment catch
A call holder can exercise at any time, and the day before a stock goes ex-dividend is the one day it is often worth doing. If your short call is in the money and the remaining time value is less than the dividend, the rational move for whoever owns that call is to exercise, take your 100 shares, and collect the payout you were counting on. You keep the premium. You lose the shares and the dividend, and you find out on a Wednesday.
2 of the names above have a confirmed ex-dividend date inside the current window, marked in the table. Those are the ones where this is not theoretical. The defence is unexciting: write strikes far enough out of the money that early exercise is not worth it, and check the ex-div calendar before selling a call that expires just after one.
Two income streams, one asset
The dividend and the call premium both come off the same 100 shares, and both cap you in the same direction. If the stock runs, you are called away and you stop collecting the dividend as well as the upside. Adding the two yields together and calling it a total return works right up to the moment assignment ends both streams at once.