PetMed Express Inc. (PETS)

Shareholders of PetMed Express Inc looking to boost their income beyond the stock's 2.1% annualized dividend yield can sell the September covered call at the $40 strike and collect the premium based on the $1.40 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 17% annualized rate in the scenario where the stock is not called away. Any upside above $40 would be lost if the stock rises there and is called away, but PETS shares would have to climb 5.8% from current levels for that to occur, meaning that in the scenario where the stock is called, the shareholder has earned a 9.6% return from this trading level, in addition to any dividends collected before the stock was called.

The most recent short interest data has been released for the 05/15/2017 settlement date, which shows a 445,775 share decrease in total short interest for PetMed Express Inc , to 3,100,869, a decrease of 12.57% since 04/28/2017. Total short interest is just one way to look at short data; another metric that we here at Dividend Channel find particularly useful is the "days to cover" metric because it considers both the total shares short and the average daily volume of shares traded.

Looking at the universe of stocks we cover at Dividend Channel, on 5/17/17, PetMed Express Inc will trade ex-dividend, for its quarterly dividend of $0.20, payable on 5/26/17. As a percentage of PETS's recent stock price of $34.41, this dividend works out to approximately 0.58%, so look for shares of PetMed Express Inc to trade 0.58% lower — all else being equal — when PETS shares open for trading on 5/17/17.

Looking at options trading activity among components of the Russell 3000 index, there is noteworthy activity today in PetMed Express Inc , where a total volume of 1,347 contracts has been traded thus far today, a contract volume which is representative of approximately 134,700 underlying shares (given that every 1 contract represents 100 underlying shares). That number works out to 55.9% of PETS's average daily trading volume over the past month, of 240,785 shares.

The DividendRank formula at Dividend Channel ranks a coverage universe of thousands of dividend stocks, according to a proprietary formula designed to identify those stocks that combine two important characteristics — strong fundamentals and a valuation that looks inexpensive. PetMed Express Inc presently has an excellent rank, in the top 25% of the coverage universe, which suggests it is among the top most "interesting" ideas that merit further research by investors.

Looking at the universe of stocks we cover at Dividend Channel, on 2/2/17, PetMed Express Inc will trade ex-dividend, for its quarterly dividend of $0.19, payable on 2/17/17. As a percentage of PETS's recent stock price of $21.25, this dividend works out to approximately 0.89%, so look for shares of PetMed Express Inc to trade 0.89% lower — all else being equal — when PETS shares open for trading on 2/2/17.

We'll book our solid gain in PETS and use the proceeds plus other cash to establish a position in the social media giant.

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Upcoming earnings could be the catalyst for a PETS move higher.

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An analysis of the data and what it means for the portfolio.

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As we close out September and the third quarter we have ample 'fire power' to continue improving the cost basis of current holdings and initiate new positions.

The model portfolio had a number of strong performers this week as the market welcomed the Fed's lack of action with open arms.