Shopify, Inc. offers a 4.5% yield with a cash-secured put option play. The stock closed at $161.14 on Oct. 3. Shorting OTM puts can set a lower buy-in point. Analysts suggest a $177.58 price target based on strong FCF.

Shorting the $141.00 put option for an immediate 3.09% yield makes sense. The put premium has decreased to 33 cents, signaling a potential rollover. Updating SHOP’s price target involves estimating FCF and market value.

Analysts project a 16% increase in SHOP’s market value, equating to a $186.92 stock price. Selling to open OTM puts for a 4.533% yield is a strategy to consider. Expected return from shorting puts in 6 months is +22.5%.

SHOP stock is undervalued, offering potential returns. Shorting OTM puts can lower the buy-in point for new investors and reduce average costs for existing investors. Barchart’s Option Education webinars can help understand the risks involved.

Read more at Yahoo Finance: Make a 4.5% One-Month Yield Shorting Shopify Cash-Secured OTM Puts