YieldBoost HCI Group From 1.4% To 13.7% Using Options

Shareholders of HCI Group Inc (HCI) looking to boost their income beyond the stock's 1.4% annualized dividend yield can sell the June 2025 covered call at the $120 strike and collect the premium based on the $7.70 bid, which annualizes to an additional 12.2% rate of return against the current stock price (at Stock Options Channel we call this the YieldBoost), for a total of 13.7% annualized rate in the scenario where the stock is not called away. Any upside above $120 would be lost if the stock rises there and is called away, but HCI shares would have to advance 9.5% from current levels for that to occur, meaning that in the scenario where the stock is called, the shareholder has earned a 16.6% return from this trading level, in addition to any dividends collected before the stock was called.