Delta Air Lines Options Offer Attractive Investment Choices

New Options Arise as December 13th Expiration Approaches

Today, investors in Delta Air Lines Inc (Symbol: DAL) were introduced to fresh options set to expire on December 13th. Using our YieldBoost formula, Stock Options Channel has identified a notable put and call contract in the DAL options chain.

The put contract at the $58.00 strike price currently has a bid of $1.49. Selling this put contract means committing to buy the stock at $58.00, while collecting the premium brings the effective cost of the shares down to $56.51 (not including broker commissions). For those looking to invest in DAL, this might be a more appealing option than purchasing shares at the current price of $58.38 each.

This $58.00 strike price is roughly a 1% discount from the present trading price, indicating its out-of-the-money status. There’s a 57% chance that this put contract could expire worthless, according to the latest analytical data, which includes greeks and implied greeks. Stock Options Channel will monitor these odds and regularly update our website with charted information for this contract. If the contract does expire worthless, the premium could yield a 2.57% return on the cash investment, translating to an annualized return of 21.79%—a figure we describe as YieldBoost.

Below is a chart that illustrates the past twelve months of trading for Delta Air Lines Inc, with a green highlight showing the position of the $58.00 strike:

On the call side, there’s a call contract available for the $62.00 strike price, which currently has a bid of $1.12. An investor could buy DAL shares at the current price of $58.38 and then sell this call as a “covered call,” agreeing to sell the stock at $62.00. If the stock is called away by the expiration date, this would yield a total return of 8.12%, excluding any dividends (and before broker commissions). However, if DAL’s share price rises significantly, some potential gains may be left unrealized, highlighting the importance of reviewing both trading history and business fundamentals.

Here is a chart showing DAL’s twelve-month trading history, with the $62.00 strike indicated in red:

Notably, the $62.00 strike price represents about a 6% premium over the current trading price. Thus, there’s also a chance the covered call contract could expire worthless, allowing the investor to retain both their shares and the received premium. Currently, there’s a 63% likelihood of this outcome, based on our analytical data. Our website will continue tracking these odds and charting relevant information about the trading history of this contract. If the covered call expires worthless, the premium would equate to a 1.92% increase in returns or an annualized 16.27%—another form of YieldBoost.

For reference, the implied volatility for the put contract is 32%, while for the call contract, it’s 40%. Meanwhile, we’ve calculated the actual trailing twelve months volatility, considering the previous 251 trading days and today’s price of $58.38, to also be 32%. For more options contract ideas worth exploring, visit StockOptionsChannel.com.

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Additional Resources:

• INTC Options Chain
• HQL Insider Buying
• TWIN Next Dividend Date

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