Shareholders of Paycom Software Inc (PAYC) looking to boost their income beyond the stock's 0.9% annualized dividend yield can sell the January 2025 covered call at the $185 strike and collect the premium based on the $18.40 bid, which annualizes to an additional 15.4% rate of return against the current stock price (at Stock Options Channel we call this the YieldBoost), for a total of 16.2% annualized rate in the scenario where the stock is not called away. Any upside above $185 would be lost if the stock rises there and is called away, but PAYC shares would have to advance 8.4% from current levels for that to happen, meaning that in the scenario where the stock is called, the shareholder has earned a 19.2% return from this trading level, in addition to any dividends collected before the stock was called.

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