Optimizing Returns with International Seaways Covered Calls

Investors are eyeing International Seaways Inc (INSW) as covered call options present an attractive YieldBoost strategy, potentially yielding up to 32.6% annually. This move could significantly enhance returns amid the company's 1.5% dividend yield.

Date: 14-03-2025

AI Rating: 7

Yield Potential Analysis
In this report regarding International Seaways Inc (INSW), shareholders are presented with the opportunity to engage in covered call options. Selling the April covered call at a $35 strike allows investors to earn a premium of 95 cents per share. This translates to an annualized return of 31.1% relative to the current stock price, potentially bringing the total return to 32.6% if the stock is not called away. Should the stock price appreciate and reach the $35 strike, shareholders would realize a 9.8% return along with any dividends accrued prior to the stock being called away.

Dividend Yield
The report mentions a 1.5% annualized dividend yield, indicating that while it is a steady income source, it is subject to fluctuations based on the company's profitability. Investors need to analyze the dividend history chart to gain insights into whether the latest dividend is sustainable.

Volatility Considerations
The report notes that INSW's trailing twelve-month volatility is calculated at 35%. This metric can provide insight into the risk associated with the stock price as it assesses price movements over the past year. Investors using this information in conjunction with fundamental analysis may determine if opting for a covered call at the $35 strike offers suitable compensation for the risk taken.

This analysis primarily centers on the potential upside investors can realize through options while also highlighting the risks associated with giving away upside potential should the stock appreciate significantly.

Stocks: INSW