New Options Trading for Helmerich & Payne May Impact Prices

Investors are eyeing potential price swings in Helmerich & Payne, Inc. (HP) as new options begin trading today. With strategic put and call contracts offering enticing premiums, the market is keen on the implications for future stock movement.

Date: 16-01-2025

AI Rating: 7

Options Trading Insights
Helmerich & Payne, Inc. (HP) has several new options contracts that could significantly impact its stock prices. Investors can look at both put and call options to gauge market sentiment and potential future price movements.

The put contract selling at a $30.00 strike price indicates a premium collection opportunity. With a bid of $1.60, if an investor sells this to open, they would effectively lower their cost basis to $28.40 per share. Given that this strike price represents a 17% discount to the current trading price, should the put expire worthless, the premium collected translates to a 5.33% return on the cash commitment, or 7.91% annualized. This creates a favorable situation for investors expecting the price to remain above $30.00.

On the other side, the call contract at a $37.50 strike, with a bid of $2.05, enables investors to potentially lock in a total return of 9.71% at expiration if the stock is called away at that lower level. However, if the stock rises significantly, investors may miss out on further upside potential. The current analysis suggests a 46% chance that the call option will expire worthless, allowing investors to retain both their shares and the premium.

Moreover, the implied volatilities for the put and call contracts are 42% and 38%, respectively, which are notable compared to the actual trailing twelve-month volatility of 37%. This discrepancy could attract trading interest as it indicates anticipated price fluctuations in the coming months.

Stocks: HP