YieldBoost Alta Equipment Group To 30.3% Using Options

Shareholders of Alta Equipment Group Inc (ALTG) looking to boost their income beyond the stock's 3.5% annualized dividend yield can sell the January 2025 covered call at the $7.50 strike and collect the premium based on the 65 cents bid, which annualizes to an additional 26.9% rate of return against the current stock price (at Stock Options Channel we call this the YieldBoost), for a total of 30.3% annualized rate in the scenario where the stock is not called away. Any upside above $7.50 would be lost if the stock rises there and is called away, but ALTG shares would have to advance 13.8% from current levels for that to happen, meaning that in the scenario where the stock is called, the shareholder has earned a 23.7% return from this trading level, in addition to any dividends collected before the stock was called.