How To YieldBoost MUSA From 0.3% To 10.9% Using Options

Shareholders of Murphy USA Inc (MUSA) looking to boost their income beyond the stock's 0.3% annualized dividend yield can sell the April 2025 covered call at the $550 strike and collect the premium based on the $35.00 bid, which annualizes to an additional 10.6% rate of return against the current stock price (at Stock Options Channel we call this the YieldBoost), for a total of 10.9% annualized rate in the scenario where the stock is not called away. Any upside above $550 would be lost if the stock rises there and is called away, but MUSA shares would have to advance 8.1% from current levels for that to occur, meaning that in the scenario where the stock is called, the shareholder has earned a 14.9% return from this trading level, in addition to any dividends collected before the stock was called.