YieldBoost UTZ From 1.5% To 14.3% Using Options

Shareholders of Utz Brands Inc (UTZ) looking to boost their income beyond the stock's 1.5% annualized dividend yield can sell the October covered call at the $17.50 strike and collect the premium based on the 55 cents bid, which annualizes to an additional 12.8% rate of return against the current stock price (at Stock Options Channel we call this the YieldBoost), for a total of 14.3% annualized rate in the scenario where the stock is not called away. Any upside above $17.50 would be lost if the stock rises there and is called away, but UTZ shares would have to advance 12.8% from current levels for that to occur, meaning that in the scenario where the stock is called, the shareholder has earned a 16.4% return from this trading level, in addition to any dividends collected before the stock was called.