How To YieldBoost ADM To 7.4% Using Options
July 03, 2024 at 12:08 PM EDT
Shareholders of Archer Daniels Midland Co. (ADM) looking to boost their income beyond the stock's 3.2% annualized dividend yield can sell the January 2026 covered call at the $75 strike and collect the premium based on the $4.00 bid, which annualizes to an additional 4.2% rate of return against the current stock price (at Stock Options Channel we call this the YieldBoost), for a total of 7.4% annualized rate in the scenario where the stock is not called away..