YieldBoost Bread Financial Holdings To 15.6% Using Options

Shareholders of Bread Financial Holdings Inc (BFH) looking to boost their income beyond the stock's 1.3% annualized dividend yield can sell the June 2025 covered call at the $75 strike and collect the premium based on the $4.70 bid, which annualizes to an additional 14.3% rate of return against the current stock price (at Stock Options Channel we call this the YieldBoost), for a total of 15.6% annualized rate in the scenario where the stock is not called away. Any upside above $75 would be lost if the stock rises there and is called away, but BFH shares would have to climb 15.3% from current levels for that to occur, meaning that in the scenario where the stock is called, the shareholder has earned a 22.5% return from this trading level, in addition to any dividends collected before the stock was called.