YieldBoost FB Financial From 1.9% To 27.1% Using Options

Shareholders of FB Financial Corp (FBK) looking to boost their income beyond the stock's 1.9% annualized dividend yield can sell the April covered call at the $55 strike and collect the premium based on the 5 cents bid, which annualizes to an additional 25.2% rate of return against the current stock price (at Stock Options Channel we call this the YieldBoost), for a total of 27.1% annualized rate in the scenario where the stock is not called away. Any upside above $55 would be lost if the stock rises there and is called away, but FBK shares would have to climb 51.9% from current levels for that to occur, meaning that in the scenario where the stock is called, the shareholder has earned a 52% return from this trading level, in addition to any dividends collected before the stock was called.