Shareholders of Circor International Inc (CIR) looking to boost their income beyond the stock's 0.3% annualized dividend yield can sell the November covered call at the $60 strike and collect the premium based on the $2.05 bid, which annualizes to an additional 14.9% rate of return against the current stock price (at Stock Options Channel we call this the YieldBoost), for a total of 15.2% annualized rate in the scenario where the stock is not called away. Any upside above $60 would be lost if the stock rises there and is called away, but CIR shares would have to advance 2.8% from current levels for that to happen, meaning that in the scenario where the stock is called, the shareholder has earned a 6.3% return from this trading level, in addition to any dividends collected before the stock was called.
YieldBoost CIR To 15.2%
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