Selling SLB puts for income.
Schlumberger Ltd. (SLB) is an oil service company that provides products and services to the global oil industry.
As the global economy picks up, demand for more oil and natural gas only increases. SLB profits as drilling, production and pipeline distribution continues to expand.
Shares trade for a reasonable valuation below 20 times this year’s profit expectations. And SLB is expected to grow profits significantly in both 2023 and 2024.
By selling the April $37.50 puts near $1.75, we’re able to collect an annualized yield near 35%, while also giving us roughly $1.50 per share in cushion between the current market price for SLB and our strike price.
- Sell (to open) 2 SLB April 14th $37.50 puts
- Limit: $1.50 or more
- The new position will represent roughly 7.7% of our model.
- 11:37 Executed
- Sold 2 SLB Apr 14th $37.50 Puts @ $1.82