Burlington Stores Sees New Options Trading on June 13 Contracts

Investors in Burlington Stores Inc (Symbol: BURL) observed new options start trading today, set for expiration on June 13. Using our YieldBoost formula, we’ve identified two notable contracts: one put and one call.

Put Contract Insights

The put contract at a strike price of $225.00 has a current bid of $11.90. If an investor chooses to sell-to-open this contract, they commit to purchasing the stock at $225.00 while collecting the premium. This action effectively lowers their cost basis to $213.10 (before broker commissions). For those already interested in buying BURL shares, this presents an appealing alternative to the current price of $228.09 per share.

This $225.00 strike price reflects about a 1% discount from the present trading price, making it out-of-the-money by that percentage. The current analytical data suggests a 57% probability that the put contract will expire worthless. We will monitor these odds and publish updates on our website over time. Should the contract expire without being exercised, the premium would yield a 5.29% return on the cash commitment, or an annualized rate of 44.89%—a figure we term the YieldBoost.

Charting the Trading History

Below is a chart depicting Burlington Stores Inc.’s trailing twelve-month trading history, with the $225.00 strike highlighted in green:

Call Contract Analysis

On the calls side, the contract at the $230.00 strike price carries a current bid of $13.40. An investor buying shares of BURL at the current price level of $228.09 and selling a covered call at this strike price would agree to sell their stock at $230.00. Including the premium collected, this scenario could yield a total return of 6.71% should the stock be called away at the June 13 expiration (before broker commissions).

Nonetheless, if BURL shares increase significantly in value, there is potential upside that could be missed. Thus, analyzing Burlington’s trading history and understanding the business fundamentals remains critical. The following chart provides insight into BURL’s trailing twelve-month trading history, highlighting the $230.00 strike in red:

This $230.00 strike represents approximately a 1% premium to the current trading price, positioning it slightly out-of-the-money. Analysts suggest a 48% probability that the covered call will expire worthless, allowing the investor to keep both their shares and the premium collected. If the contract does expire worthless, the premium would equate to a 5.87% boost in returns, or 49.87% on an annualized basis—also categorized as a YieldBoost.

Volatility Metrics

The implied volatility for the put contract stands at 50%, while the call contract shows 49% implied volatility. In contrast, the actual trailing twelve-month volatility (based on the last 250 trading days and today’s price of $228.09) is calculated at 40%. For further put and call options contract ideas, please visit our website.

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