Core Viewpoint - The article discusses the potential of using a long-term covered call strategy on Walmart stock to generate income and enhance yield, especially in a market facing selling pressure. Summary by Sections Stock Performance and Strategy - Walmart stock remains above its 21-day, 50-day, and 200-day moving averages, indicating it is still in a buy zone despite recent market sell-offs [2] - The stock has a low beta and offers a 0.84% dividend yield, which can be significantly increased through a long-term covered call strategy [2][6] Covered Call Mechanics - A covered call involves buying 100 shares of Walmart and selling a call option against those shares, which generates premium income [3] - Selling a September 18, 2026, call option with a strike price of 110 can yield approximately $1,055 in premium per contract, reducing the net cost of purchasing 100 shares to around $9,590 [4][5] Yield and Returns - The yield from the covered call strategy amounts to approximately 11%, or closer to 12% when annualized, not including the dividend [5] - If Walmart's stock price exceeds 110 at expiration, the total return could reach 14.6%, equating to an annualized return of 15.9% [5] Risk and Management - Covered calls provide income generation and some downside protection, allowing investors to sell another call if the stock closes below the strike price at expiration [6] - Investors should carefully consider the pros and cons of the stock before engaging in a bullish trade like a covered call [6] Stock Ratings and Market Position - Walmart holds a Composite Rating of 68 out of 99, an Earnings Per Share Rating of 62, and a Relative Strength Rating of 78, ranking second in the Retail-Major Discount Chains group [7] - The company operates under a low-cost philosophy, maintaining lower prices through cost control across its segments: Walmart U.S., Walmart International, and Sam's Club [8]