Strategy To YieldBoost CTSH From 1.8% To 8.9% Using Options
June 13, 2024 at 11:44 AM EDT
Shareholders of Cognizant Technology Solutions Corp. (CTSH) looking to boost their income beyond the stock's 1.8% annualized dividend yield can sell the June 2025 covered call at the $72.50 strike and collect the premium based on the $4.70 bid, which annualizes to an additional 7.1% rate of return against the current stock price (at Stock Options Channel we call this the YieldBoost), for a total of 8.9% annualized rate in the scenario where the stock is not called away..
