So far I have made *$710.00 selling Celgene Corp (CELG) Puts and *$760.00 selling Bristol-Myers Squibb (BMY) Puts in 2019, but I still don’t own any shares. Bristol-Myers Squibb is buying Celgene, and the closure of the acquisition should happen by the third quarter.
Maybe I will get lucky this time. After all, third time’s a charm!
Here is the new trade:
- Sold: Ten (10) June 28, 2019 Puts
- Strike Price: $44.00
- *Premium Collected: *$850.00
If I am forced to buy the 1000 shares, my entry price will be approx. $43.15 per share – almost a 33% discount to Bristol-Myers Fair Value of $65.00 per share – providing a comfortable Margin of Safety. Bristol-Myers pays a 3.58% dividend – 1/4 of the dividend will be paid in July 2019, so if I get the shares – I would also be receiving a $400.00 dividend a few days later for my trouble.
*Excludes transaction costs.
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