Stock of the Week

04 Dec 2024 - Investing

This is the fourth Stock of the Week post, for the week of December 1, 2024. In my Stock of the Week posts, I discuss a security (stock or ETF) that I am currently buying or selling, and will explain my rationale. These are trades I am personally making, so you will either make money with me or lose money with me by entering these trades (ideally the former). Financial Disclaimer

Stock of the Week

This week’s Stock of the Week is $MRNY, the YieldMax MRNA Option Income Strategy ETF. Moderna ($MRNA) is currently down 62.5% at the time of writing, which we can take advantage of by buying [$MRNY]. Due to the recent presidential election win of Donald Trump, I believe legislation will be put in place (such as banning direct-to-consumer advertisements for pharma companies) that will continue to drive down the profits of MRNA, driving down the share price as well for MRNA and MRNY. This makes $MRNY even better for cash flow, as if we reinvest our dividends we will be able to buy more shares at the cheaper prices (as long as the ETF is not reverse split back to $30+). I recommend turning Dividend Reinvestment on for MRNY until YieldMax decides to do a reverse split to maximize your cash flow while share price is cheap. Once the ETF is reverse split we can then analyze our position and decide whether to turn Dividend Reinvestment off and use the dividends elsewhere.

As previously mentioned, my goal for my portfolio is to generate weekly cash flow through dividend income, and I believe MRNY is a perfect addition to our portfolio to help us with that. MRNY is currently at $5.46 per share, down 1.27% on the day. According to Nasdaq.com, MRNY has a 52.43% Dividend Yield, paying monthly distributions of about $0.22 per share. This is down from the $0.40 per share MRNY has been paying in previous months due to the decline in share price. Still, a 50% annual yield means you will double your initial investment in about 2 years, which is much better than most dividend paying securities. The ex-date for MRNY for the month of December is today, December 4, with Payment date being tomorrow, December 5.