Naked Puts: DirecTV (DTV)
DirecTV (DTV) has always been one of my favorite stocks to use options to profit from. DTV stock is in very solid form with a good hold on market share for satellite TV both in the U.S. and Latin America. DTV stock has very reliable annual free cash flow in the $2 billion to $3 billion range. DTV stock has settled into stalwart status with reliable 10% annual EPS growth. Management under CEO Mike White is solid.
The stock is at $71.09, with the March 70 Put going for $1.67. You earn a 2.3% return, or about 19% annualized. You also get $1.09 margin for error because DTV stock trades above $70. Sell two contracts for $334 in income.