Shutterstock Inc Offers Attractive YieldBoost Options Strategy.

A recent report reveals Shutterstock Inc's strategy that allows shareholders to enhance income through a covered call at a $45 strike. This presents a potential total annualized return of 11.9%. The report addresses dividend predictability, offering insights into Shutterstock's share potential.

Date: 18-12-2024

AI Rating: 7

The report discusses Shutterstock Inc (SSTK) and its strategy for shareholders looking to boost income by selling covered calls. Specifically, the report states that shareholders can sell a December 2025 covered call at the $45 strike and collect a premium with an annualized return of 8.2%. When combined with the stock's 3.7% annualized dividend yield, the total return could reach 11.9% if the stock is not called away.

Furthermore, if the stock is called away, shareholders could still earn a significant return of 50.2%, given the requirement for the stock to rise 42% from its current value. This highlights a potential for gains that could attract investors looking for both immediate income and long-term capital appreciation.

The report also mentions that dividends are tied to the company's profitability, indicating that while the current yield is 3.7%, future dividends may fluctuate based on the company's earnings performance. This emphasizes the importance of analyzing the dividend history to gauge future expectations.

Another key aspect addressed in the report is the trading volume of options among S&P 500 components. The reported put:call ratio of 0.40 indicates a preference for calling options, showcasing market sentiment leaning towards a bullish outlook for the stock. High call volume relative to puts could signal investor confidence in potential upward price movement.

In summary, the report provides insights into potential income strategies through covered calls and highlights the importance of dividend reliability for long-term investors. Investors may find opportunities in SSTK, backed by a strong approach to options trading and favorable market sentiment.

Stocks: SSTK