Diving into New Options for Charles River Laboratories International Inc.

With January 2025 contracts now available for Charles River Laboratories International Inc. (CRL), investors gain access to new opportunities in the options market. As the clock ticks with 331 days until expiration, these contracts offer a prospective advantage for put or call sellers to potentially secure higher premiums compared to nearer expiration contracts. Stock Options Channel’s YieldBoost formula has scoured the entir CRL options chain for these new contracts and identified a put and call contract that stand out from the rest.

At a strike price of $230.00, the current bid for the put contract stands at $21.10. By selling-to-open this put contract, an investor commits to purchasing the stock at $230.00, while collecting the premium. This effectively reduces the cost basis of the shares to $208.90 (before broker commissions). For an investor eyeing CRL shares, this presents an attractive alternative to the current market price of $236.49 per share. The $230.00 strike represents a roughly 3% discount to the existing trading price, raising the possibility that the put contract would expire worthless. However, the current data indicates a 99% chance of that happening. If the contract does expire worthless, the premium would deliver a 9.17% return on the cash commitment, or 10.12% annualized, known as the YieldBoost.

On the calls side, the $240.00 strike price call contract has a current bid of $32.00. Purchasing CRL shares at the current price and then selling-to-open this call contract as a “covered call” obliges the investor to sell the stock at $240.00. With the call seller also collecting the premium, this move could yield a total return of 15.02% if the stock gets called away at the January 2025 expiration (excluding dividends, if any). However, it’s crucial to weigh the potential opportunity costs if CRL shares surge. Examining CRL’s trailing twelve-month trading history becomes imperative in this light. In this case, below is a chart highlighting the $240.00 strike in red:

Marking approximately a 1% premium to the current trading price, the $240.00 strike also raises the possibility of the covered call contract expiring worthless, indicating a 99% chance of this happening based on current analytical data. If the covered call contract does expire worthless, the premium would impart a 13.53% additional return to the investor or 14.92% annualized, referred to as the YieldBoost.

Meanwhile, the actual trailing twelve-month volatility is calculated at 34%. For further put and call options worth exploring, a visit to StockOptionsChannel.com is recommended.

Also see:

• NCBC Videos
• RRC Insider Buying
• SO Next Dividend Date

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