Shareholders of Flagstar Bank (FLG) have the opportunity to enhance their annualized dividend yield of 0.3% by selling a January 2028 covered call at the $17 strike price, generating a premium of $1.30. This strategy can potentially yield an additional 4.9%, bringing the total annualized return to 5.2% if the stock isn’t called away. The stock would need to increase by 32.9% to hit the $17 mark, resulting in a 43.1% return for shareholders if called, including dividends collected prior to the call.
As of the latest trading, Flagstar Bank’s stock price is at $12.76, with a trailing twelve-month volatility of 39%. Data from mid-afternoon trading on Friday indicates that the put volume among S&P 500 components totaled 910,982 contracts while call volume reached 1.88 million, reflecting a put-to-call ratio of 0.49, significantly lower than the long-term median of 0.65, suggesting strong preference for call options among traders.
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