Aptiv PLC, (formerly Delphi Automotive) is based in Dublin, Ireland. They design and manufacture components and provide electrical, electronic, and active safety technology solutions to the global automotive and commercial vehicles markets. Its segments include Signal and Power Solutions and Advanced Safety and User Experiences. As such, it is included in the Consumer Discretionary sector.
The potential time value profit for this Aptiv position is $.84 per share for the 300 shares if the stock is above the $80.00 strike price on the January 19th options expiration date and is therefore assigned (i.e. sold) at the $80.00 strike price. Aptiv met all 23 criteria specified in my Buffett Screener and analysts have an average target price of $112.96 (+34.8% above today's stock purchase price). As preferred, there is no intervening earnings report since the next quarterly earnings report on January 31st is after the January 19th options expiration date.
1/5/2024 Bought 300 shares of Aptiv stock @ $83.80 per share.
1/5/2024 Sold 3 Aptiv January 19th, 2024 $80.00 Call options @ $4.64 per share.
A possible overall performance result (including commissions) is as follows:
Covered Calls Net Investment: $23,750.01
= ($83.80 - $4.64) * 300 shares + $2.01 commission
Net Profit Components:
(a) Options Income: +$1,389.99
= ($4.64 * 300 shares) - $2.01 commission
(b) Dividend Income: +$0.00
(c) Capital Appreciation: (If Aptiv stock price is above the $80.00 strike price at the 1/19/2024 options expiration date): -$1,140.00
= ($80.00 selling price at expiration - $83.80 original stock purchase price) x 300 shares
Potential Total Net Profit (If Aptiv stock price is in-the-money at the options expiration date and therefore sold at the $80.00 strike price): +$249.99
= (+$1,389.99 options income + $0.00 dividend income - $1,140.00 capital appreciation)
Potential Absolute Return-on-Investment: +1.1%
= +$249.99/$23,750.01
Potential Equivalent Annualized-Return-on-Investment: +27.4%
= (+$249.99/$23,750.01) * (365/14 days)
