How To YieldBoost El Paso Electric Company From 2.8% To 5.9%

Shareholders of El Paso Electric Company (NYSE: EE) looking to boost their income beyond the stock's 2.8% annualized dividend yield can sell the March 2014 covered call at the $40 strike and collect the premium based on the 70 cents bid, which annualizes to an additional 3.1% rate of return against the current stock price (at Stock Options Channel we call this the YieldBoost), for a total of 5.9% annualized rate in the scenario where the stock is not called away. Any upside above $40 would be lo...