How To YieldBoost Pier 1 Imports To 10.9% Using Options
August 17, 2015 at 11:40 AM EDT
Shareholders of Pier 1 Imports Inc. (PIR) looking to boost their income beyond the stock's 2.5% annualized dividend yield can sell the January 2016 covered call at the $13 strike and collect the premium based on the 40 cents bid, which annualizes to an additional 8.5% rate of return against the current stock price (at Stock Options Channel we call this the YieldBoost), for a total of 10.9% annualized rate in the scenario where the stock is not called away..