YieldBoost OUTFRONT Media To 16.6% Using Options

Shareholders of OUTFRONT Media Inc (OUT) looking to boost their income beyond the stock's 7.8% annualized dividend yield can sell the December covered call at the $17 strike and collect the premium based on the 60 cents bid, which annualizes to an additional 8.8% rate of return against the current stock price (at Stock Options Channel we call this the YieldBoost), for a total of 16.6% annualized rate in the scenario where the stock is not called away. Any upside above $17 would be lost if the stock rises there and is called away, but OUT shares would have to advance 11.1% from current levels for that to happen, meaning that in the scenario where the stock is called, the shareholder has earned a 15% return from this trading level, in addition to any dividends collected before the stock was called.