Double Your Dividends with this Options Strategy on Omega Healthcare

Company Overview - Omega Healthcare Investors, Inc. is a self-administered real estate investment trust (REIT) focused on investing in income-producing healthcare facilities, primarily long-term care facilities in the U.S. and the U.K. [7] - The company provides lease or mortgage financing to qualified operators of skilled nursing facilities (SNFs) and, to a lesser extent, assisted living facilities (ALFs), independent living facilities, and rehabilitation and acute care facilities [8]. Investment Opportunity - With markets becoming more volatile, investors are increasingly interested in generating income rather than capital gains, making Omega Healthcare a staple for dividend investors [1]. - The stock has a low Beta of 0.69 and a high yield of 6.07%, presenting an attractive opportunity for investors [1]. Covered Call Strategy - A covered call strategy can more than double the yield on OHI shares, involving selling call options against a stock position [2]. - Buying 100 shares of OHI costs $4,367, and the March 20, 2026 call option with a strike price of $46 was trading around $0.90, generating $90 in premium per contract [3]. - Selling the call option generates an income of 2.1% in 128 days, equating to approximately 6.0% annualized, in addition to the yearly dividend of $2.68, which yields 6.07% [3]. - The total yield from the covered call strategy increases from 6.07% to 12.07% [3]. Potential Returns - If OHI closes above the strike price of $46 at expiration, the shares will be called away, resulting in a total profit of $323, which translates to a 7.6% return or 21.5% on an annualized basis [4].