Exploring Put Options: Tidewater Inc’s Attractive January 2027 Strategy
Investors eyeing Tidewater Inc (Symbol: TDW) may find an intriguing strategy by considering the sale of put options, instead of purchasing shares at the current market price of $43.41 per share. One standout contract is the January 2027 put with a $30 strike price, currently bidding at $4.60. Selling this put could yield a return of 15.3% based on the $30 commitment, translating to an annualized return of 8.2%—a figure referred to as the YieldBoost at Stock Options Channel.
Understanding the Mechanics of Selling Puts
Opting to sell a put gives investors a way to generate income, but it does not allow for the same upside potential that comes with actual ownership of shares. A put seller only acquires shares if the option is exercised. The buyer will choose to exercise the option at the $30 strike price only if it is more favorable than selling at the market price. Therefore, unless Tidewater’s share price drops by 31.2% and the contract is exercised, the seller’s primary benefit is collecting the premium, earning that 8.2% annualized return.
Potential Outcomes and Market Insights
The following chart illustrates the trailing twelve-month trading history for Tidewater Inc, with the $30 strike price marked for reference:
Investors can use the chart alongside Tidewater’s historical volatility to determine if selling the January 2027 put at the $30 strike presents a favorable risk-reward scenario. Tidewater’s volatility over the past year, calculated based on the last 250 trading days and the current price of $43.41, stands at 49%. For additional put options and expirations, please refer to the TDW Options page on StockOptionsChannel.com.
Top YieldBoost Puts of the S&P 500 »
Also see:
- IDE YTD Return
- Institutional Holders of NQ
- YELP Stock Predictions
The views and opinions expressed herein are those of the author and do not necessarily reflect the views of Nasdaq, Inc.
