Maximizing Returns: Investing in Sysco Corp’s Covered Call Options
Shareholders of Sysco Corp (Symbol: SYY) may consider selling the January 2026 covered call at the $82.50 strike to enhance their income. This option allows them to collect a premium based on the current bid of $5.30, translating into an annualized return boost of 6.3% based on the present stock price. Together with the stock’s existing 2.6% dividend yield, this can result in a total annualized return of 8.9% if the stock remains below the strike price. However, any gains above $82.50 will be forfeited if the stock is called away, requiring a 5.4% increase from the current levels. If that occurs, shareholders would benefit from a combined return of 12.2%, accounting for dividends earned before the sale.
Dividend payouts are not always stable and typically fluctuate with a company’s profitability. Therefore, analyzing Sysco Corp’s dividend history can aid in assessing whether the recent dividend may persist, suggesting a reasonable expectation for the 2.6% annualized yield.
Below is a chart displaying Sysco’s trailing twelve-month trading history, with the $82.50 strike price marked in red:
This chart, in conjunction with the stock’s historical volatility, provides insights into whether selling the January 2026 covered call at the $82.50 strike is a prudent decision. Sysco’s trailing twelve-month volatility, calculated using the last 251 trading days and the current stock price of $78.24, stands at 19%. For more options trading ideas regarding SYY, visit the Stock Options page at StockOptionsChannel.com.
On Wednesday afternoon, the put volume among S&P 500 companies reached 917,141 contracts, while call volume soared to 2.30M, resulting in a put:call ratio of 0.40 for the day. This figure is considerably lower than the long-term median ratio of 0.65, indicating a strong preference for call options among traders during today’s activity.
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Additional Resources:
- STE Next Dividend Date
- Top Ten Hedge Funds Holding IXC
- HHLA Shares Outstanding History
The views and opinions expressed herein are those of the author and do not necessarily reflect those of Nasdaq, Inc.
