WillScot Holdings Offers Investor Income Boost Through Covered Calls

Shareholders of WillScot Holdings Corp (WSC) can enhance their income beyond the current 1% annualized dividend yield by selling December 2026 covered calls at a $35 strike price. This strategy allows investors to collect a premium based on the $3.30 bid, resulting in an additional 7.8% annualized return at the current stock price. If the stock is not called away, the total annualized return would reach 8.8%. However, any gains over $35 would be forfeited if the stock rises past that point. WSC shares would need to increase by 28.8% for the stock to be called away, offering shareholders a potential 40.9% return at that juncture, plus any dividends collected before the call is executed.

Dividend payments can fluctuate based on each company’s profitability. To evaluate the sustainability of the recent 1% annualized dividend yield from WillScot, investors can refer to the dividend history chart for WSC below.

The chart above illustrates WSC’s trailing twelve-month trading history, highlighting the $35 strike in red:

This analysis, combined with the company’s historical volatility, can help determine if selling the December 2026 covered call at the $35 strike is a wise risk-reward tradeoff. The trailing twelve-month volatility for WillScot, calculated from the last 250 trading days and today’s price of $27.23, stands at 50%. For additional call options contract ideas, visit the WSC Options page at StockOptionsChannel.com.

In mid-afternoon trading on Thursday, S&P 500 put volume was at 1.32 million contracts, while call volume reached 2.28 million, resulting in a put:call ratio of 0.58. This figure indicates a higher reliance on call options compared to puts, aligning with a long-term median put:call ratio of 0.65. Thus, buyers are currently favoring calls in options trading.

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The views and opinions expressed herein are those of the author and do not necessarily reflect those of Nasdaq, Inc.