Suncor Energy (SU) has a high 4.8% dividend yield and a low earnings multiple. This makes the stock attractive to value investors. It has also made shorting puts and calls popular with these investors.
For example, last month in our article “Suncor Energy's 4.35% Yield And Buybacks Are Drawing Option Income Investors,” we discussed shorting calls and puts for the period expiring April 6. The calls were out-of-the-money (OTM) at a strike price of $39.00 and SU closed yesterday at $32.00, so the call option income earned was completely free. This was because the shorted call option expired worthless as the contract was not exercised. The covered call investor made a 0.56% yield based on the 20 cents premium price.
