$MKC
MKC Covered Call
Filled View on X
Strategy
Covered Call
Entry date
Oct 8, 2026
Net
$43.15 debit
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Legs
| Action | Qty | Expiry | Strike | Type | Premium |
|---|---|---|---|---|---|
| Buy | 100 | - | - | Stock | $46.01 |
| STO | 1 | Jan 15, 2027 | 45.00 | Call | $3.00 |
Trade thesis
The trade (filled Oct 8):
- Buy 100 shares of McCormick (MKC) at $46.01
- Sell to open the Jan 15, 2027 $45 call at $3.00
- Net debit: $43.15/share ($4,315)
The math:
- Called away at $45: $1.85/share price gain on a $43.15 basis
- Plus two $0.48 quarterly dividends ($0.96)
- Total: $2.81/share = 6.5% in 99 days → 24.0% annualized
- Downside: $3.00 premium banked, $43.15 breakeven, 6.2% cushion
The thesis:
McCormick has raised its quarterly dividend every year - $0.34 in 2022 to $0.48 today, a 4.19% yield at current prices. Boring staples compounder with real pricing power - exactly the kind of stock to write calls against.
