Wayfair Inc (Symbol: W) began trading new options today with an expiration date set for August 2027. Notably, a put contract at a $70.00 strike price is currently bid at $16.80, allowing sellers to potentially secure shares at an effective cost basis of $53.20, which represents a 2% discount compared to the current stock price of $71.63. There is a 68% chance that the put option could expire worthless, potentially offering a 24.00% return on cash commitment, or 19.73% annualized.
On the call side, a contract at the $80.00 strike price is bid at $18.45. If investors purchase shares at $71.63 and sell this call, they could achieve a total return of 37.44% by the August 2027 expiration, assuming the stock is called away. The strike price is approximately 12% above the current trading price, with a 38% likelihood that the option will expire worthless, resulting in an extra return of 25.76%, or 21.17% annualized.
The implied volatility for the put contract is at 70%, while the call contract shows an implied volatility of 71%. Current trailing twelve-month volatility is estimated at 62%.
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