This DLTR Debit Call Spread Can Net 28% in 17 Days
Bullish play with a target stock price of $66 or above
Strategy has +28% upside potential and 4% undervalued
| Expiration | 08-Nov-24 |
| Buy | 61 Call |
| Sell | 66 Call |
| Debit: | $3.90 |
Option Profit Calculator for DLTR Call Spread at 08-Nov-24 Expiration
If DLTR stock price at expiration is at or above $66.00, this spread has a 28% upside potential
The optimal stock price for this option strategy is to close at or above $66.00 on the expiration date, November 8, 2024. In that scenario, both calls would be in-the-money, so the spread would be worth the maximum value of 5.00. That would equate to the potential upside of +28% for this call spread with 17 days left to expiration.
The maximum gain will be realized if the stock price is at or above 66.00. The maximum gain is $1.10
The breakeven point is at 64.90, which is 5.0% below the current spot price.
The maximum loss will occur when the stock price is at or below 61. The max loss is $3.90.
DLTR Spread Current Market Price vs. Historical Average
DLTR Call Spread is trading at a 4% discount to historical average.
Using historical data to measure how a similar spread in DLTR was priced in the market, the 4-year average value was 4.04, with a high mark of 4.52 and a low of 3.79.
Currently, this vertical call spread is bid at 3.55 and offered at 3.90. The midpoint of the spread is 3.72.
If we use 4.04 as our historical fair value benchmark, the current market ask price is at a 4% discount, while the current market midpoint represents a 8% discount.
| Current Price | Historical Values of Similar Spreads | ||||
| Bid | Ask | Midpoint | Average | High | Low |
| 3.55 | 3.90 | 3.72 | 4.04 | 4.52 | 3.79 |
Takeaway
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