August 15th Options Now Available For Weatherford International (WFRD)

Analysis of Weatherford International plc (WFRD) options reveals potential strategies for investors. Selling a put option at the $40 strike offers a 1.62% return if it expires worthless, while a covered call strategy at the $45 strike could yield 10.71% if the stock is called away, with implied volatilities at 57% and 60% respectively. Stock Options Channel will track the odds of these contracts expiring worthless, providing data for investors to assess the risk/reward.

Analysis

The options market for Weatherford International plc (WFRD) presents distinct opportunities for investors based on current pricing and implied metrics. Selling a put contract at the $40.00 strike price, with a bid of 65 cents, offers an alternative entry point at an effective cost basis of $39.35 per share, representing a 9% discount to the current $44.08 share price; this strategy has a 68% probability of the option expiring worthless, which would yield a 1.62% return on cash commitment (7.70% annualized). The implied volatility for this put is 57%. Conversely, for existing shareholders, a covered call strategy at the $45.00 strike, with a bid of $3.80, could generate a total return of 10.71% if the stock is called away by the August 15th expiration. Should this call option expire worthless, an event with a 48% probability, the premium collected would represent an 8.62% yield boost (40.86% annualized). The implied volatility for this call is 60%. Both implied volatilities are slightly above WFRD's actual trailing twelve-month volatility of 54%, suggesting a modest premium priced into the options.

Key Decisions for Investors

• Investors interested in acquiring WFRD shares at a discount to the current market price of $44.08 could consider selling the $40.00 strike put, which offers a potential cost basis of $39.35 or a 1.62% return if the option expires worthless.
• Shareholders of WFRD looking to generate income might evaluate selling the $45.00 strike covered call, targeting a 10.71% return if shares are called away or an 8.62% premium yield if the option expires worthless, but should be aware of capping upside potential above $45.00.
• Investors should monitor the evolving probabilities of these options expiring worthless, as tracked by Stock Options Channel, and weigh the current implied volatilities (57% for puts, 60% for calls) against the stock's historical volatility (54%) and their own outlook for WFRD's fundamentals and share price movement.