Crescent Energy Co (CRGY) is offering shareholders an opportunity to enhance their income through a covered call option at a $10 strike price, set to expire in December 2023. The option’s current bid is 85 cents, which translates to an additional annualized return of 10.7%. If the stock remains below $10, shareholders could achieve a total annualized return of 16.4%. However, a price increase above $10 would mean losing potential gains, requiring a 20.5% rise from its current level of $8.34 for the stock to be called, resulting in a potential 30.7% return including dividends.
As of Friday, the put volume among S&P 500 components stood at 1.09 million contracts, while call volume reached 2.06 million, leading to a put:call ratio of 0.53. This contrasts with the long-term median ratio of 0.65, indicating a strong preference for call options among investors.
Crescent Energy’s current dividend yield is 5.8%, and while dividends are unpredictable, historical analysis might assist investors in anticipating future performance.
