YieldBoost MTB To 17.2% Using Options

Shareholders of M & T Bank Corp (MTB) looking to boost their income beyond the stock's 3.1% annualized dividend yield can sell the April 2025 covered call at the $175 strike and collect the premium based on the $14.10 bid, which annualizes to an additional 14.1% rate of return against the current stock price (at Stock Options Channel we call this the YieldBoost), for a total of 17.2% annualized rate in the scenario where the stock is not called away. Any upside above $175 would be lost if the stock rises there and is called away, but MTB shares would have to advance 1.1% from current levels for that to happen, meaning that in the scenario where the stock is called, the shareholder has earned a 9.2% return from this trading level, in addition to any dividends collected before the stock was called.