Pfizer (PFE) is moving higher this week on vaccine-related news following last week’s pop on strong earnings results.
It is becoming increasingly clear that people are going to require booster shots as coronavirus cases rise due to the Delta variant. That means more doses of Pfizer’s COVID-19 vaccine will be needed.
The Food and Drug Administration said it is accelerating its effort to review the vaccine for full approval.
Additionally, the U.S. Army awarded Pfizer a $3.5 billion contract to produce 500 million doses by the end of 2022 for distribution around the world.
I am recommending we roll our existing PFE put to a higher strike, keeping the expiration date the same. This will increase our cash in hand and potential rate of return.
If you are not currently in a PFE put and wish to enter one today, just be aware that we will be tracking and managing this as an ongoing position.
Current Stock Price: $44.77
Cash in Hand: $0.39
- Buy to close the PFE Aug Week One (8/6) 42.50 Put for around $0.02
- Sell to open the PFE Aug Week One (8/6) 45 Put for around $0.50
- Set your initial credit limit at $0.48, but adjust as needed to roll today
New Cash in Hand: $0.87
Expiration: After the close on Friday, Aug. 6
Potential Rate of Return: 1.9% in 10 days, or 71% on an annualized basis