Wednesday, May 10, 2017

Kohl's KSS option

I received an alert today on call activity of Kohl's, symbol KSS.  Kohl's is a controversial 2017 Dividend Machine.   It fits all my criteria and I particularly liked the most recent 10% dividend increase.

Apparently, there is quite a bit of call activity on KSS.  The chart below presents the price of a $42.50 call with an expiration date of May 19, 2017.

With this in mind, I looked for a call further out; a call that would capture a good premium plus the dividend.  I am selling this call today on a portion of my KSS.  You might consider the same move if you are long KSS.  If you bought when I wrote up KSS as a 2017 Dividend Machine the first table presents your potential return.

If you bought KSS today, at $40.34 your potential return is presented in the table below.

M* MoneyMadam

Disclosure:  Long KSS with calls