How To YieldBoost Nike To 6.3% Using Options

Shareholders of Nike (NKE) looking to boost their income beyond the stock's 1.7% annualized dividend yield can sell the January 2027 covered call at the $110 strike and collect the premium based on the $9.35 bid, which annualizes to an additional 4.6% rate of return against the current stock price (at Stock Options Channel we call this the YieldBoost), for a total of 6.3% annualized rate in the scenario where the stock is not called away. Any upside above $110 would be lost if the stock rises there and is called away, but NKE shares would have to advance 25.5% from current levels for that to occur, meaning that in the scenario where the stock is called, the shareholder has earned a 36.1% return from this trading level, in addition to any dividends collected before the stock was called.