Strategy To YieldBoost BOBE From 2.7% To 13.6% Using Options
July 24, 2014 at 11:29 AM EDT
Shareholders of Bob Evans Farms, Inc. (BOBE) looking to boost their income beyond the stock's 2.7% annualized dividend yield can sell the December covered call at the $50 strike and collect the premium based on the $2.05 bid, which annualizes to an additional 10.9% rate of return against the current stock price (at Stock Options Channel we call this the YieldBoost), for a total of 13.6% annualized rate in the scenario where the stock is not called away..