How To YieldBoost Franklin Electric From 1% To 9.1% Using Options
August 22, 2014 at 11:44 AM EDT
Shareholders of Franklin Electric Co., Inc. (FELE) looking to boost their income beyond the stock's 1% annualized dividend yield can sell the January 2015 covered call at the $40 strike and collect the premium based on the $1.25 bid, which annualizes to an additional 8.2% rate of return against the current stock price (at Stock Options Channel we call this the YieldBoost), for a total of 9.1% annualized rate in the scenario where the stock is not called away..