YieldBoost Avery Dennison From 1.8% To 13.2% Using Options

Shareholders of Avery Dennison Corp (AVY) looking to boost their income beyond the stock's 1.8% annualized dividend yield can sell the April 2025 covered call at the $200 strike and collect the premium based on the $7.20 bid, which annualizes to an additional 11.3% rate of return against the current stock price (at Stock Options Channel we call this the YieldBoost), for a total of 13.2% annualized rate in the scenario where the stock is not called away. Any upside above $200 would be lost if the stock rises there and is called away, but AVY shares would have to advance 3.6% from current levels for that to occur, meaning that in the scenario where the stock is called, the shareholder has earned a 7.3% return from this trading level, in addition to any dividends collected before the stock was called.