Roll Up of Boeing Co. Covered Call

The Covered Calls Advisor recently established one Covered Call in the Boeing Co. at the February 15th, 2019 $345.00 strike price.  The price of Boeing shares spiked upward by over $26 per share in response to its very positive quarterly earnings report two days ago.  They reported record annual sales, profits, and plane deliveries for 2018.  Looking forward, they project another record year for all three of these measures in 2019 and are further bolstered by a record year-end backlog of existing orders for 5,873 future plane deliveries (a 6+ years backlog).  Boeing and Airbus provide an excellent example of a powerful duopoly in a world with ongoing increasing demands for more airplanes.  View this interesting video for a perspective on this (link).

As a result, the time value remaining in the February 15th, 2019 $345.00 strike Call option was reduced to only $.52 [$46.78 Feb 15th $345.00 Calls option value - ($391.26 share price today - $345.00 strike price)] with 15 days remaining until the expiration date. The quarterly dividend of $2.055 per share goes ex-dividend next Thursday and the Covered Calls Advisor decided to significantly increase the probability of capturing this dividend by rolling up from the $345.00 strike to the $375.00 strike at the same February 15th expiration date. The time value remaining in the Feb 15th $375.00 strike price is $2.02 [$18.28 Feb 15th $375.00 Call option value - ($391.26 share price today - $375.00 strike price)], so the hope is to capture the $2.02 time value plus the $2.055 dividend per share as profit over the 15 days remaining until the options expiration. This will occur if the Boeing stock price remains above $375.00 by the Feb 15th expiration.

As detailed below, a potential return-on-investment result for this Boeing Covered Call since its inception on January 22nd  is +3.1% absolute return in 25 days (equivalent to a +45.0% annualized return-on-investment).  By rolling up the original Covered Call, this result would exceed the 2.7% absolute return (39.9% annualized) if it is assigned upon the Feb 15th expiration.   

Boeing Co. (BA) -- Continuation Covered Calls Position
The transactions to-date are:
01/22/2019 Bought 100 Boeing shares @ $356.41
01/22/2019 Sold 1 Boeing 02/15/2019 $345.00 Call option @ $18.39
Note: A simultaneous buy/write transaction was executed.
02/01/2019  Bought-to-Close 1 BA Feb 15, 2019 $345.00 Call option @ $46.78
02/01/2019 Sold-to-Open 1 BA Feb 15, 2019 $375.00 Call option @ $18.28
Note: this was a simultaneously executed roll-up transaction executed when BA was at $391.26 per share.
02/07/2019 Upcoming quarterly ex-dividend of $2.055 per share

A possible overall performance result (including commissions) for this Boeing Co. Covered Call position is as follows:
Covered Calls Cost Basis: $33,806.95
= ($356.41 - $18.39) *100 + $4.95 commission

Net Profit Components:
(a) Options Income: -$1,017.96
= ($18.39 -$46.78 +18.28) *100 shares) - $6.96 commissions
(b) Dividend Income (If Boeing shares assigned at Feb 15th, 2019 expiration): +$205.50
= ($2.055 dividend per share x 100 shares)

(c) Capital Appreciation (If BA assigned at $375.00 strike price at options expiration): +$1,854.05
+($375.00-$356.41)*100 shares - $4.95 commissions

Total Net Profit (If Boeing shares assigned at $375.00 at Feb 15th, 2019 expiration): +$1,041.59

= (-$1,017.96 +$205.50 +$1,854.05)

Absolute Return (If Boeing shares assigned at $375.00 at Feb 15th, 2019 expiration): +3.1%

= +$1,041.59/$33,806.95

Annualized Return: +45.0%

= (+$1,041.59/$33,806.95)*(365/25 days)