Covered Calls: Disney (DIS)
Walt Disney Co (NYSE:DIS) reported earnings that were okay, but not great. The stock fell about 5% on the news and closed Wednesday at $102.83.
I consider DIS stock to be one of those stock to hold for a very long time. Despite troubles at ESPN, the fact is that Disney will be part of the human entertainment experience for a long time. So for those who own the stock and are holding it, DIS is dead money for a while. It will probably be dead money until at least the next earnings report, or longer, since the market is overvalued.
Thus, you may want to consider selling the Oct $105 covered calls for $2.10. That’s about a 2.1% return, and you have a $2.17 buffer before hitting the strike price.