Tuesday, September 24, 2019

HCI Exceptional Call


HCI Group, symbol HCI is a dividend stock I have owned for about two years.  I bought it based on the yield and dividend growth.  It also has reasonable debt, but revenues are not growing.  



The stock price has ranged between $36.72 and $59.32.  I would like to get rid of HCI through calls.  I sell calls and they have never been assigned.  



Today, I sold a call that does not capture the next dividend but the total return for me if they take my shares by exercising their right to buy is quite good – 13.8%. 



HCI $45 call expires October 18, 2019.





With this call I have income in mind.  The premium I received is over 1%.  I like that.  Moreover, the duration of the call is very short.  If HCI is assigned that is okay with me and if I keep it, I will continue to sell calls.   If the fundamentals deteriorate such as no longer increasing the dividend, I will sell it all.



M* MoneyMadam