Investors in CRH plc (Symbol: CRH) saw new options trading commence today for the May 22nd expiration. Notably, a put contract at the $104.00 strike price is being bid at $3.60, indicating a commitment to purchase shares at that price, which adjusts the cost basis to $100.40. This represents an approximate 1% discount to the current trading price of $104.85 per share, with a 55% chance of the contract expiring worthless. If it does, the premium collected would yield a 3.46% return on the cash commitment, or 25.27% annualized.
On the call side, a contract at the $115.00 strike price has a current bid of $1.35. If shares are bought at $104.85 and the call is sold, there is potential for a total return of 10.97% at expiration, excluding commissions. This strike is approximately 10% above the current stock price, with a 70% probability of expiring worthless, allowing the investor to retain both the shares and the premium, yielding a 1.29% boost, or 9.40% annualized. The implied volatility for the put contract stands at 39%, while the call carries a 42% implied volatility.
