The put contract at the $4.00 strike price has a current bid of 40 cents. If an investor was to sell-to-open that put contract, they are committing to purchase the stock at $4.00, but will also collect the premium, putting the cost basis of the shares at $3.60 (before broker commissions). To an investor already interested in purchasing shares of ENDP, that could represent an attractive alternative to paying $4.46/share today.

Because the $4.00 strike represents an approximate 10% discount to the current trading price of the stock (in other words it is out-of-the-money by that percentage), there is also the possibility that the put contract would expire worthless. The current analytical data (including greeks and implied greeks) suggest the current odds of that happening are 100%. Stock Options Channel will track those odds over time to see how they change, publishing a chart of those numbers on our website under the contract detail page for this contract. Should the contract expire worthless, the premium would represent a 10.00% return on the cash commitment, or 84.80% annualized — at Stock Options Channel we call this the YieldBoost.

I use that term loosely because Wall Street defines it to be a drop of 10%. We did not do that, in fact the S&P 500 stayed pretty close to all-time highs. This week we could take those out, if not maybe in the next few to follow. One sector had tangible reasons to suffer. The experts acknowledge that there is a global shortage for semiconductor equipment and components. Therefore, today we look for semiconductor stocks to buy on these dips.

The consequences from such supply disruptions extend beyond the sector. But today we will focus on three leading companies, as they could have better days ahead. The sentiment among investors has repaired itself, but I’m still reading too many bearish opinions. On the one hand, reliable experts are calling for a recession. While at the same time other mavens are warning of runaway inflation.