Shareholders of 3M Co (Ticker: MMM) can enhance their income by selling January 2027 covered calls at the $190 strike price, earning a premium of $10.50, which translates to an additional annualized return of 4.4%, combining with the existing 1.9% dividend yield for a total of 6.3%. If 3M shares rise above $190, which represents a 23% increase from current levels, shareholders would have a total return of 29.8% from this trading position, including dividends before the shares are called.
The current price of 3M Co shares is $154.77, with a calculated trailing twelve-month volatility of 35%. As of midday trading on Wednesday, the S&P 500 put volume stood at 964,394 contracts vs. call volume at 1.71 million, resulting in a put:call ratio of 0.56, indicating a higher preference for calls among options traders compared to the long-term average of 0.65.
