Analysis of Covered Call Options for ET Stock
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 2 days ago
0mins
Source: NASDAQ.COM
- Options Overview: The current bid for the call contract at the $25.00 strike price is 11 cents; if an investor buys ET stock at $19.43 and sells this contract, they could achieve a total return of 29.23% by June 2027, highlighting the potential profitability of this strategy.
- Volatility Analysis: The implied volatility of the call option is 51%, while the actual trailing twelve-month volatility is 16%, indicating a significant market expectation for price fluctuations in ET stock, which necessitates careful risk assessment by investors.
- Yield Enhancement Potential: Should the covered call expire worthless, investors would retain both their shares and the premium collected, potentially providing an additional 0.57% return boost, or 0.60% annualized, thus offering an attractive opportunity for enhanced returns.
- Market Outlook Consideration: Given that the $25.00 strike represents a 29% premium over the current trading price and with a 65% chance of the contract expiring worthless, investors should closely monitor ET's fundamentals and trading history to optimize their investment strategies.
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Analyst Views on ET
Wall Street analysts forecast ET stock price to rise
11 Analyst Rating
7 Buy
4 Hold
0 Sell
Moderate Buy
Current: 19.250
Low
17.00
Averages
20.65
High
23.00
Current: 19.250
Low
17.00
Averages
20.65
High
23.00
About ET
Energy Transfer LP owns and operates a diversified portfolios of energy assets in the United States, with more than 140,000 miles of pipeline and associated energy infrastructure. The Company’s strategic network spans 44 states with assets in all of the major United States production basins. Its core operations include complementary natural gas midstream, intrastate and interstate transportation and storage assets; crude oil, natural gas liquids (NGL) and refined product transportation and terminalling assets; and NGL fractionation. The Company’s segments include intrastate transportation and storage, interstate transportation and storage, midstream, NGL and refined products transportation and services, crude oil transportation and services, investment in Sunoco LP, investment in USA Compression Partners, LP (USAC), and all other. It also owns Lake Charles LNG Company, LLC, its wholly owned subsidiary, which owns an LNG import terminal and regasification facility.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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