Crinetics Pharmaceuticals Options Trading Insights for August 15 Expiration

Investors in Crinetics Pharmaceuticals Inc (Symbol: CRNX) observed new options trading today, set to expire on August 15. With 100 days remaining until expiration, these contracts offer a potential opportunity for sellers of puts or calls to secure a higher premium compared to contracts with a shorter time frame. The YieldBoost formula at Stock Options Channel has analyzed the CRNX options chain and pinpointed one put and one call contract of particular interest.

Put Contract Analysis

The put contract at the $30.00 strike price currently bids at $1.35. By selling-to-open this put contract, an investor would agree to purchase shares at $30.00 while also collecting the premium, resulting in an effective cost basis of $28.65 per share (excluding broker commissions). For investors keen on acquiring CRNX shares, this offer presents a compelling alternative compared to paying the current market price of $30.52 per share.

Notably, the $30.00 strike price indicates roughly a 2% discount to the present trading price, meaning it is out-of-the-money by that percentage. Current analytical data suggest a 60% probability that this put contract may expire worthless. Stock Options Channel will monitor these odds over time, displaying a chart on the contract detail page for ongoing updates. Should the contract expire worthless, the premium would yield a 4.50% return on the cash commitment, or 16.43% annualized, a figure we refer to as the YieldBoost.

Below is the chart displaying the trailing twelve-month trading history for Crinetics Pharmaceuticals Inc, with the $30.00 strike position highlighted in green:

Call Contract Insights

Shifting to the call side of the options chain, the call contract at the $32.00 strike price currently bids at $1.50. If an investor were to buy shares of CRNX at the current price of $30.52 and then sell-to-open this call contract as a covered call, they would commit to selling the stock at $32.00. Including the premium, this could lead to a total return, excluding any dividends, of 9.76% if the stock gets called away at the August 15 expiration (before broker commissions). However, the potential upside could be significant if CRNX shares rise sharply, making it crucial to consider both the trading history and the company’s fundamentals.

Below is a chart showing CRNX’s trailing twelve-month trading history, with the $32.00 strike price highlighted in red:

The $32.00 strike reflects about a 5% premium to the current trading price, indicating that it is also out-of-the-money by that same percentage. Consequently, there is a chance that this covered call contract may expire worthless, allowing the investor to retain both their shares and the premium collected. Current analytical figures show a 48% likelihood of this scenario occurring. Stock Options Channel will also track and report these odds over time, illustrating the trading history of the option contract.

If the covered call contract expires worthless, the premium collected signals a 4.91% boost in extra return, or 17.94% annualized, referred to as the YieldBoost.

Implied volatility for both the put and call contracts is approximately 62%. However, our analysis of actual trailing twelve-month volatility, factoring in the last 250 trading days and today’s price of $30.52, is about 50%. For additional ideas on put and call options contracts, you can explore more options.

The views and opinions expressed herein are those of the author and do not necessarily reflect those of Nasdaq, Inc.