Investors considering Redwire Corp (NYSE: RDW) shares at a market price of $7.12 may find value in selling put options. Notably, a January 2028 put option at a $4 strike is currently available with a bid of $1.25, offering a 31.2% return on the $4 commitment, translating to a 15.2% annualized rate of return.
Selling this put option does not provide the same upside potential as owning shares, as the seller only acquires the stock if the contract is exercised, which would require the stock price to decline by 44%. The stock’s historical volatility is calculated at 114%, indicating a significant price fluctuation over the past year.
