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Civitas Resources Inc (CIVI) shareholders can enhance their income through a covered call strategy by selling the January 2028 call at a $37.50 strike price, collecting a premium of $5.30, which equates to an annualized return of 8.5%. This would bring the total potential annualized return to 15.2% if the stock is not called away. Currently, shares are priced at $29.71, meaning a 27.2% increase is required for the stock to be called away, yielding a total return of 45.2% from current levels, including dividends.
On Tuesday afternoon, the S&P 500 experienced a put volume of 614,789 contracts and call volume of 1.20 million, resulting in a put-call ratio of 0.51. This indicates a significantly higher preference for call options compared to puts, compared to the long-term median ratio of 0.65.
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