YieldBoost Aris Water Solutions To 10.9% Using Options

Shareholders of Aris Water Solutions Inc (ARIS) looking to boost their income beyond the stock's 1.6% annualized dividend yield can sell the April 2025 covered call at the $30 strike and collect the premium based on the 95 cents bid, which annualizes to an additional 9.3% rate of return against the current stock price (at Stock Options Channel we call this the YieldBoost), for a total of 10.9% annualized rate in the scenario where the stock is not called away. Any upside above $30 would be lost if the stock rises there and is called away, but ARIS shares would have to climb 18.8% from current levels for that to happen, meaning that in the scenario where the stock is called, the shareholder has earned a 22.6% return from this trading level, in addition to any dividends collected before the stock was called.