Account I (.50 Weight)
2/18. Bought DKS @ 51.24. Sold 22 MAR 52.5 calls against entire position for 1.50. 2.9% immediate return from premium.
Account II. (.17 Weight)
Bought DKS @ 51.28. Sold 22 MAR 52.5 calls against most of the position for 1.5.0 2.9% return from premium.
Account III. (.17 Weight)
Bought DKS @ 51.32. Sold 22 MAR 52.5 calls against most of the position for 1.50. 2.9% return on premium.
Account IV (.17 Weight)
Bought DKS @ 51.40.
DKS should be priced between 50ish to 60ish, depending on how I calculate it. Some elements I like: solid balance sheet, dividend (albeit small), share repurchases, decent margins for the industry, excellent same store sales growth (exceeding expectations), strong new store growth (going from apx 550 units now to over 800 by the end of 2017), GARP based on PEG, and a solid "story" of benefiting from the active wear apparel craze, especially Under Armour (which is using a "store within a store" concept at DKS). Also, while AMZN is putting some pressure on DKS (free shipping and low prices), DKS enjoys some protection against AMZN in the nature of its product mix. In comparing DKS with its competitors such as HIBB, BGFV, and Sport Authority, DKS is best of breed IMO.
DKS declared its 12.5 div today payable on March 28th to shareholders of record on March 7th. Earnings Call expected mid-March. I'm fine if I'm called away at 52.5, and fine if I'm not. I could see the shares being called away before the ex div date because I could see the shares being run up by then and call holders wanting to capture the dividend. That adds to my margin of safety, I think. We'll see. As I say, I'm fine if they are called and fine if they are not.
Disclosure: I am long DKS.