VAL

Discussion in 'Options' started by oldnemesis, Mar 21, 2016.

  1. http://finance.yahoo.com/news/sherwin-williams-company-acquire-valspar-170000400.html

    Purchase price is 113 cash.
    Expected to close Jan '17

    http://stockcharts.com/h-sc/ui?s=val

    Trade:
    VAL closed at 103.22
    Oct 100/105 bull call spread for a net debit of $295

    Price........... Profit / Loss....... ROI %
    75.00.............. (295.00)........ -100.00%
    85.00.............. (295.00)........ -100.00%
    97.16.............. (295.00)........ -100.00%
    100.00............ (295.00)........ -100.00%
    102.95................. 0.00............. 0.00%
    105.00.............. 205.00........... 69.49%
    108.52.............. 205.00........... 69.49%
    119.89.............. 205.00........... 69.49%
    131.25.............. 205.00........... 69.49%

    Note 1 : Don't do this unless you are experienced in dealing with acquisitions
    Note 2 : Ordinarily I would want options dated to the expected deal close or beyond, but the Oct options are the furthest out available... the deal should be pretty well cooked by then.
    Note 3: Best filled at the open.
    Note 4: Note the 105 number related to divestitures.
     
    Last edited: Mar 22, 2016