Avery Dennison Options Update: New Contracts Announced

Avery Dennison investors are presented with new options today. The May 16th contracts, featuring a put at $175 and a call at $180, offer varying yields and strategies. This update could influence AVY stock performance and investor decisions.

Date: 20-03-2025

AI Rating: 6

Options Availability: Avery Dennison Corp (AVY) has introduced new options contracts, with a put at $175 and a call at $180, potentially affecting stock prices.

Put Contract Insights: The put contract at the $175 strike price shows a current bid of $3.40. If investors sell-to-open, they effectively agree to purchase shares at $175, resulting in a cost basis of $171.60. This represents about a 2% discount from the current trading price of $179.01. The odds of the put contract expiring worthless (thus retaining the premium) are 62%. This could yield a return of 1.94% based on the cash commitment, or an annualized return of 12.44%. This makes the put contract an attractive option for investors looking to buy AVY shares.

Call Contract Insights: On the call side, the $180 strike call has a bid of $5.20. Purchasing shares at $179.01 and selling the $180 call generates a potential return of 3.46% if exercised by May 16. However, there is a 49% chance the call may expire worthless, allowing investors to keep both shares and premiums, suggesting a 2.90% additional return or 18.60% annualized yield.

Implied Volatility: The implied volatility for both contracts is about 26%, indicating a level of market expectation for future price fluctuations. The historical volatility over the last 250 trading days stands at 19%, suggesting less price movement historically compared to the market’s current expectations.

Stocks: AVY