I love TD:

TD Bank raises quarterly dividend by ~13%; to buy back 50M shares

TD -0.46%Dec. 02, 2021 6:46 AM ET5 Comments

• TD Bank (NYSE:TD) declares CAD 0.89/share quarterly dividend, 12.7% increase from prior dividend of CAD 0.79.
• Forward yield 3.87%
• Payable Jan. 31; for shareholders of record Jan. 10; ex-div Jan. 7.
• See TD's dividend grades vs. peers CM, RY, USB, BNS and BMO:
• The company also announced today that, subject to the approval of OSFI and the Toronto Stock Exchange ("TSX"), it intends to launch a Normal Course Issuer Bid ("NCIB") permitting the purchase for cancellation of up to 50 million of its common shares, representing approximately 2.7% of TD's issued and outstanding common shares as at October 31, 2021.
• As at October 31, 2021, the Bank's Common Equity Tier 1, Tier 1, Total Capital and Leverage ratios were 15.19%, 16.45%, 19.12% and 4.77%, respectively.
• Now read: Canadian Imperial Bank raises quarterly dividend by ~10%; shares buyback
• Royal Bank of Canada to repurchase 45M shares, boosts dividend by 11%;
• Bank of Nova Scotia stock gains after Q4 earnings beat, dividend hike.
• See TD Dividend Scorecard, Yield Chart, & Dividend Growth.

$74.50 is $130Bn and these guys are making $14Bn a year and made $12Bn last year so rock-steady income stream.  They have long-term options now and only a 3.5% dividend ($2.55), so not worth owning the stock but, for the LTP, let's:

• Sell 10 TD 2024 $70 puts for $8.50 ($8,500) 
• Buy 25 TD 2024 $60 calls for $15 ($37,500) 
• Sell 25 TD 2024 $75 calls for $7.50 ($18,750) 
• Sell 5 TD April $75 calls for $3 ($1,500) 

That's net $8,750 on the $37,500 spread so we have $28,750 of upside potential where we are now and we have 7 more quarters to sell calls as well to knock down the basis.  Our risk is owning 1,000 shares at net $68.75 – and we'd be happy to do that anyway.