Strategy To YieldBoost LAD From 0.7% To 17.9% Using Options

Shareholders of Lithia Motors, Inc. (LAD) looking to boost their income beyond the stock's 0.7% annualized dividend yield can sell the March 2016 covered call at the $115 strike and collect the premium based on the $7.90 bid, which annualizes to an additional 17.2% rate of return against the current stock price (at Stock Options Channel we call this the YieldBoost), for a total of 17.9% annualized rate in the scenario where the stock is not called away..