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Investors in Hormel Foods Corp. (HRL) saw new options contracts begin trading today, with expiration set for June 2026. The put option at a $23.00 strike price has a current bid of $0.35, allowing investors to potentially purchase shares at an effective cost of $22.65, which is about 3% below the current market price of $23.77. The odds of this put expiring worthless are approximately 59%, with a projected return of 1.52% on the cash commitment, or 2.27% annualized.
On the calls side, a contract at a $25.00 strike price has a current bid of $0.40. If exercised, this would mean a total return of 6.86% (excluding dividends), as it represents a 5% premium over the current trading price. The odds of this call expiring worthless are currently at 52%, which would also yield an additional 1.68% return to the investor, or 2.51% annualized.
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