YieldBoost Monolithic Power Systems To 11.2% Using Options

Shareholders of Monolithic Power Systems Inc (MPWR) looking to boost their income beyond the stock's 0.8% annualized dividend yield can sell the December 2025 covered call at the $830 strike and collect the premium based on the $64.10 bid, which annualizes to an additional 10.3% rate of return against the current stock price (at Stock Options Channel we call this the YieldBoost), for a total of 11.2% annualized rate in the scenario where the stock is not called away. Any upside above $830 would be lost if the stock rises there and is called away, but MPWR shares would have to advance 37.4% from current levels for that to happen, meaning that in the scenario where the stock is called, the shareholder has earned a 48% return from this trading level, in addition to any dividends collected before the stock was called.