Investors in BJ’s Wholesale Club Holdings Inc (Symbol: BJ) gained access to new options expiring in June 2027 on October 2, 2023. Noteworthy contracts include a put option at a $90.00 strike price, currently bid at $9.30, allowing sellers to potentially purchase shares at an effective cost of $80.70, approximately 11.6% below the current price of $91.17. The likelihood of this put expiring worthless stands at 64%, potentially yielding a 10.33% return on cash commitment, or 7.48% annualized.
Additionally, a call option with a $100.00 strike price is available at a bid of $10.50. Investors buying shares at $91.17 and selling this covered call could see a total return of 21.20% if exercised, with a 47% chance of the option expiring worthless, allowing investors to retain both the shares and premium. Implied volatility for both options is approximately 33%, while the trailing twelve-month volatility for BJ is calculated to be 31%.
