Investors in The Gap Inc. (GAP) can now access new options set to expire in February 2026. A notable call contract is available at a $27.50 strike price, currently bidding at 30 cents. Investors purchasing GAP shares at $25.61 and selling this call as a covered call could see a total return of 8.55% upon expiration, excluding dividends.
The $27.50 strike reflects a 7% premium over the current trading price, with a 58% likelihood that the call will expire worthless—allowing investors to retain their shares and the premium collected. If the contract does expire worthless, this premium would boost overall returns by 1.17%, or 9.72% annualized. The implied volatility for this contract stands at 62%, compared to a trailing twelve-month volatility of 57%.
