Investors in Constellation Brands Inc (NYSE: STZ) can now trade new options expiring on March 27th, 2024. Two contracts have notably attracted interest: a put option at the $165.00 strike price with a current bid of $4.90 and a call option at the $167.50 strike price with a bid of $4.70. The current stock price is $165.96.
Selling the put option would put the cost basis at $160.10 if exercised, representing a 2.97% return on cash commitment, or 21.70% annualized, assuming it expires worthless (current odds: 53%). The call option offers a potential total return of 3.76% if the stock is called away at expiration, also with a 52% chance of expiring worthless.
Implied volatilities for the put and call options are 29% and 30%, respectively. The actual trailing twelve-month volatility based on closing values including today’s price is calculated at 28%.
