Strategy To YieldBoost RCII To 7.6% Using Options
March 05, 2015 at 11:51 AM EST
Shareholders of Rent-A-Center Inc. (RCII) looking to boost their income beyond the stock's 3.5% annualized dividend yield can sell the September covered call at the $35 strike and collect the premium based on the 60 cents bid, which annualizes to an additional 4.1% rate of return against the current stock price (at Stock Options Channel we call this the YieldBoost), for a total of 7.6% annualized rate in the scenario where the stock is not called away..