Continuation of Covered Calls Position in Target Corporation

The Covered Calls Advisor Portfolio has a Covered Calls position in Target Corporation (ticker TGT) with 200 shares and 2 Call options at the $150.00 strike price scheduled to expire today.  Early in this afternoon's trading when the stock was at $145.48, my net credit limit order at $2.16 per share was executed to roll-down-and-out the Covered Calls to the $148.00 strike price and at the June 21st, 2024 monthly options expiration date.  

As detailed below, a potential outcome for this Target Corp. investment if the stock is in-the-money and therefore assigned on the options expiration date is +2.1% absolute return-on-investment over 45 days (equivalent to +17.4% annualized-return-on-investment) if the stock closes above the $148.00 strike price on the June 21st, 2024 options expiration date.  The transactions history of this Target Covered Calls position so far along with a potential return-on-investment result if the stock is assigned on the June 21st options expiration date is as follows:

Target Corporation (TGT) -- Continuation of Covered Calls Position
The buy/write transaction was:
5/7/2024 Bought 200 Target Corporation shares @ $160.06.
5/7/2024 Sold 2 TGT 5/24/2024 $150.00 Call options @ $11.99 per share.
5/14/2024 Ex-dividend of $1.10 per share.

5/24/2024 Continued this Target Corporation Covered Calls position with a rollout transaction by simultaneously buying-to-close 2 Target 5/24/2024 $150.00 Calls at $.01 per share and selling-to-open 2 6/21/2024 $148.00 Calls at $2.17 per share when the stock price was $145.48.

A possible overall performance result (including commission) for this Covered Call position is as follows:
Covered Calls Net Investment: $29,615.34
= ($160.06 - $11.99) * 200 shares + $1.34 commission

Net Profit Components:
(a) Options Income: +$2,827.32
= ($11.99 -$.01 + $2.17) * 200 shares - $2.68 commissions
(b) Dividend Income: $220.00

= ($1.10 per share x 200 shares)
(c) Capital Appreciation (If shares assigned at $148.00 strike price at the 6/21/2024 options expiration date): -$2,412.00
+($148.00 strike price - $160.06 stock purchase price) * 200 shares

Total Net Profit (If stock shares assigned at $148.00 strike price at the 6/21/2024 options expiration date): +$635.32

= (+$2,827.32 options income +$220.00 dividend income -$2,412.00 capital appreciation)

Potential Absolute Return-on-Investment (if assigned on the 6/21/2024 options expiration date): +2.1%

= +$635.32/$29,615.34

Potential Annualized Return-on-Investment: +17.4%

= (+$635.32/$29,615.34) * (365/45 days)

Jeff Partlow (The Covered Calls Advisor)
partlow@cox.net