New Paychex Options Offer Opportunities for Investors

April 2025 Options Present Attractive Strategies for Buyers and Sellers

Today, Paychex Inc (Symbol: PAYX) launched new options contracts with an expiration date set for April 2025. With 107 days until expiration, these contracts offer an intriguing chance for options sellers to secure higher premiums compared to shorter-term contracts. Stock Options Channel has examined the PAYX options chain and found one put and one call contract of notable interest.

The put contract at a $140.00 strike price currently has a bid of $2.95. If an investor opts to sell this put contract, they would be agreeing to buy shares at $140.00 while also collecting the premium. This results in an effective cost basis of $137.05 per share (not including broker fees). For investors keen on acquiring PAYX shares, this could be an appealing alternative to purchasing shares at the current market price of $140.90.

Importantly, the $140.00 strike price represents about a 1% discount from the stock’s current price, meaning it’s slightly out-of-the-money. There’s a 56% chance, based on current analytical data, that this put contract could expire worthless. Stock Options Channel plans to monitor these odds over time, providing updates on their website under the contract detail page. Should the contract indeed expire worthless, the premium would yield a 2.11% return on the cash commitment, or 7.19% annualized—this is referred to as the YieldBoost.

Below is a chart illustrating the trailing twelve-month trading history for Paychex Inc, highlighting the position of the $140.00 strike price within that trend:

On the call side, a contract at the $145.00 strike price is currently valued with a bid of $2.00. If an investor buys PAYX shares at $140.90 and sells this call as a “covered call,” they agree to sell at $145.00. Collecting the premium, they could potentially achieve a total return of 4.33% if the shares are called away by the April 2025 expiration (before broker fees). However, substantial price gains in PAYX shares might limit the upside potential of this strategy, making analysis of the company’s trading history and fundamentals crucial.

Here’s a chart displaying Paychex’s twelve-month trading history, with the $145.00 strike highlighted:

The $145.00 strike is about 3% above the current trading price, meaning it’s also out-of-the-money. There’s a 58% likelihood that this covered call could expire worthless, at which point the investor could retain both their shares and the collected premium. Current data suggests that should the covered call expire worthless, the premium would enhance returns by 1.42%—equivalent to an annualized yield of 4.84%, also classified as the YieldBoost.

Both the put and call contracts are characterized by an implied volatility of roughly 19%. Meanwhile, the actual trailing twelve-month volatility is calculated at 18%, based on the last 251 trading days and today’s price of $140.90. For more options contract strategies, explore StockOptionsChannel.com.

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