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Covered call can pay about 11% annualized on Booking stock
The strategy sells a BKNG call expiring 9/17/2027 at a $236 strike, collecting about $2,455 premium per contract for 100 shares.
Yahoo Finance outlines a covered call approach for Booking Holdings shareholders, pairing the stock position with an options sale that aims to generate income regardless of share performance. The proposal is designed for investors willing to cap gains if BKNG rallies.
The plan calls for selling one BKNG call expiring 9/17/2027 with a strike price of $236, which is stated as about 15% above the stock level referenced in the analysis. The premium collected is about $2,455 per contract covering 100 shares, framed as roughly 11.0% annualized on the stock value referenced.
According to the article, if BKNG is above $236 at expiration, shares would be called away at $236, and the analysis estimates a total return of about 25% annualized once the premium is included, while limiting upside beyond the strike. If BKNG finishes below $236, the call expires worthless, investors keep the premium, and the writer notes the income earned is about 12% over roughly 395 days.
The article also highlights the tradeoff: the premium may offset the first part of any decline over the holding period, but it does not protect beyond that. It adds that the main cost is the opportunity foregone if the stock surges well above the strike.