Kraft Heinz Options Trading: Key Insights for Investors

Kraft Heinz Co (KHC) sees new options trading activity. Investors can explore attractive put and call contracts as well as potential yield boosts, which could positively influence KHC stock prices in the near future.

Date: 30-01-2025

AI Rating: 6

Options Trading Activity
Investors in Kraft Heinz Co have new options contracts starting to trade with expiration on March 14th. This includes both a put and a call contract that could potentially affect KHC's stock prices.

Put Contract Analysis
The put contract at a $28.00 strike price presents an interesting investment opportunity. The bid is currently at 44 cents, meaning an investor would be committing to purchase KHC shares at $28.00 while collecting the premium. This results in a cost basis of $27.56. The opportunity is enhanced by a 6% discount to the current trading price of $29.81, making it an attractive alternative for those interested in purchasing shares of KHC.

The expected probability of the put option expiring worthless is 74%, indicating a favorable chance for investors to keep the premium of 1.57% return on cash commitment (13.35% annualized), which could appeal to conservative investors looking for stable returns.

Call Contract Analysis
The call contract at the $32.00 strike price has a current bid of 28 cents. If investors take the covered call approach, selling the call while owning the stock at $29.81, they would lock in a total return of 8.29% if the stock price hits $32.00 by expiration. This represents a potential upside for investors willing to trade some future appreciation for immediate income from the call premium.

Furthermore, the call contract is approximately 7% above the current stock price, with a 64% chance of expiring worthless, allowing investors to retain shares and the premium. The expected premium represents a 0.94% return (7.98% annualized) for the covered call, highlighting potential stability and income generation in the portfolio.

Implied Volatility Insights
The implied volatility for the put is at 30% and the call at 47%, while actual trailing twelve month volatility stands at 20%. These metrics suggest fluctuations in stock prices and may influence investor decisions regarding KHC.

Stocks: KHC