Strategy To YieldBoost PTEN From 0.4% To 21.8% Using Options
May 25, 2016 at 11:42 AM EDT
Shareholders of Patterson-UTI Energy Inc. (PTEN) looking to boost their income beyond the stock's 0.4% annualized dividend yield can sell the November covered call at the $19 strike and collect the premium based on the $1.90 bid, which annualizes to an additional 21.4% rate of return against the current stock price (at Stock Options Channel we call this the YieldBoost), for a total of 21.8% annualized rate in the scenario where the stock is not called away..