Investors considering Tandem Diabetes Care Inc (TNDM) may find selling put options an attractive alternative to buying shares at the current market price of $20.73. One notable option is the January 2027 put at a $13 strike, with a bid of $1.75, offering a potential 14.2% annualized return based on a 13.5% commitment against the $13 strike price.
The put seller only assumes ownership of shares if the stock price falls 37.4% to $13, leading to a cost basis of $11.25 after accounting for the premium received. The trailing twelve-month volatility for TNDM is calculated at 79%, indicating significant price fluctuations, which investors should consider when evaluating the associated risks and potential rewards of this strategy.
