New Options Available for C3.ai Inc: Insight and Analysis
Today, investors in C3.ai Inc (Symbol: AI) gained access to new options for the June 6th expiration date. Our analysis at Options Channel has identified one put and one call contract that merit attention.
Put Option Overview
The put contract available at the $21.00 strike price has a bid of 34 cents. Investors choosing to sell-to-open this put contract would be obligated to purchase stock at $21.00. However, by collecting the premium, their effective cost basis would drop to $20.66 per share (before brokerage fees). This alternative may be especially appealing to those looking to buy shares at a price lower than the current trading rate of $21.32/share.
This $21.00 strike price is approximately 2% below the current trading price, meaning it is out-of-the-money by that percentage. The data indicates a 57% probability that the put contract could expire worthless. Our platform will continue to track this probability and will provide updates on any changes over time. If the contract does expire worthless, the premium would yield a 1.62% return on the cash commitment, equating to an annualized return of 13.74%. We refer to this as the YieldBoost.
Visualizing the Trading History
The chart below illustrates the trailing twelve-month trading history for C3.ai Inc, highlighting the position of the $21.00 strike in green:
Call Option Overview
On the calls side, the $22.00 strike price has a current bid of 8 cents. An investor who buys shares of AI stock at $21.32/share and then sells-to-open the call contract as a “covered call” commits to selling the stock at $22.00. Including the collected premium, this strategy could result in a total return of 3.56% if the stock is called away at the June 6th expiration (excluding any dividends and before commissions). However, significant upside could be attenuated if AI shares rise substantially, making it essential to evaluate both historical trading data and the company’s fundamentals.
The chart below represents AI’s trailing twelve-month trading history, with the $22.00 strike highlighted in red:
Notably, the $22.00 strike is approximately 3% above the current trading price, placing it out-of-the-money by that margin. Consequently, there is a 51% chance that this covered call contract may expire worthless, allowing investors to retain both their shares and the premium accrued. Our analytics will also monitor these odds over time, sharing relevant updates. Should this contract expire worthless, the premium would increase the investor’s total return by 0.38%, or 3.19% on an annualized basis, interpreting this as another YieldBoost.
Volatility Insights
The implied volatility for the put option stands at 80%, while the call option’s implied volatility is 74%. Additionally, the actual trailing twelve-month volatility—derived from the last 250 trading days, including today’s price of $21.32—is currently calculated at 62%. For further options contract ideas worth exploring, visit our options channel.
