YieldBoost UNP To 5.2% Using Options

Shareholders of Union Pacific Corp (UNP) looking to boost their income beyond the stock's 2.3% annualized dividend yield can sell the December 2025 covered call at the $280 strike and collect the premium based on the $10.10 bid, which annualizes to an additional 2.9% rate of return against the current stock price (at Stock Options Channel we call this the YieldBoost), for a total of 5.2% annualized rate in the scenario where the stock is not called away. Any upside above $280 would be lost if the stock rises there and is called away, but UNP shares would have to advance 22.6% from current levels for that to occur, meaning that in the scenario where the stock is called, the shareholder has earned a 27% return from this trading level, in addition to any dividends collected before the stock was called.