Organon & Co: Strategies for Increased Income Through Covered Calls
Shareholders aiming for greater returns from Organon & Co (Symbol: OGN) can consider selling a January 2026 covered call at the $22.50 strike price. This strategy could yield an extra 5.1% in annualized returns based on the $1.10 premium, complementing the stock’s current 6.4% dividend yield for a total potential annual return of 11.4%. If the stock rises above $22.50, shareholders would miss out on this upside. However, the stock would need to climb 28.1% from its current level for this scenario to occur. In such a case, investors could still enjoy a significant 34.4% return, factoring in dividends received before the stock is called.
Dividend amounts can fluctuate based on each company’s profitability. For Organon & Co, reviewing the dividend history chart below can provide insight into whether sustaining the current 6.4% annualized yield is likely.
The following chart illustrates OGN’s trailing twelve-month trading history, with the $22.50 strike highlighted in red:
This historical chart and OGN’s stock volatility can guide investors in assessing whether selling the January 2026 covered call at $22.50 offers a good risk-reward balance. According to recent analysis, Organon & Co’s trailing twelve-month volatility, based on the last 250 trading day closing values and the current price of $17.57, stands at 41%. Investors interested in other call options with varying expiration dates can explore options on the OGN Stock Options page at StockOptionsChannel.com.
In mid-afternoon trading on Monday, the S&P 500 put volume reached 838,171 contracts, while call volume was higher at 1.76 million contracts, resulting in a put:call ratio of 0.48 for the day. With the long-term median ratio at 0.65, today’s high call volume suggests a strong preference for call options among traders.
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The views expressed in this article are those of the author and do not necessarily reflect the opinions of Nasdaq, Inc.
