Nutrien Ltd Options: New Opportunities for Investors Ahead of May Expiration

Investors monitoring Nutrien Ltd (Symbol: NTR) have new options to consider, particularly with contracts expiring on May 30. Stock Options Channel has analyzed the NTR options chain to identify one put and one call contract of significant interest.

Put Contract Analysis

The put contract with a strike price of $46.00 currently has a bid of $1.40. An investor selling-to-open this put contract would agree to buy shares at $46.00. Additionally, receiving the premium results in an effective cost basis of $44.60 per share, assuming broker commissions are excluded. For investors looking to buy shares of NTR, this strategy presents a more favorable alternative compared to the current market price of $47.80.

Notably, the $46.00 strike is about a 4% discount from the stock’s current trading price, indicating that it is out-of-the-money by the same percentage. Current analytical data estimates the odds of this put contract expiring worthless to be 62%. Stock Options Channel will continue to track these odds and update them over time, providing further insights on their detailed contract page. If the put contract expires worthless, the premium would yield a 3.04% return on the cash commitment, translating to an annualized return of 22.22%, a metric we refer to as YieldBoost.

Call Contract Examination

Shifting focus to the call options, the contract with a $49.00 strike price is currently bidding at $1.75. If an investor purchases NTR shares at the current price of $47.80 and sells this call contract as a covered call, they would agree to sell the stock at $49.00. Along with collecting the premium, the total return, excluding dividends, would be 6.17% if the stock is called away by the May 30 expiration. However, significant upside potential could be lost should NTR share prices surge. Thus, analyzing NTR’s trading history and business fundamentals becomes vital.

Below is a chart that highlights NTR’s trailing twelve-month trading history, marking the $49.00 strike in red:

The $49.00 strike price reflects approximately a 3% premium above the current stock trading price, indicating that it is also out-of-the-money by this percentage. As a result, the possibility of the covered call expiring worthless exists, allowing the investor to retain both their shares and the premium earned. Current analysis suggests that the odds of this scenario are 55%. Tracking these statistics over time will also be available on the Stock Options Channel’s website, including a historical chart of the option contract.

In the event that the covered call expires worthless, the premium would equate to a 3.66% additional return for the investor or an annualized return of 26.73%, also categorized under our YieldBoost term.

Volatility Insights

The implied volatility for the put contract is measured at 36%, while the call contract shows a volatility of 40%. In contrast, the trailing twelve-month volatility, calculated from the past 251 trading days and today’s closing price of $47.80, stands at 27%. For additional options contract strategies worth exploring, visit StockOptionsChannel.com.

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Learn more:

• Precious Metals Dividend Stocks
• TRT Historical Stock Prices
• INTF Options Chain

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