The Labor Department reported Friday, before the markets opened, that the U.S. added 172,000 jobs in May.
While that was down 7,000 from April’s report, it suggests that the economy, at least from a jobs perspective, remains quite resilient with a low unemployment rate of 4.3%.
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Furthermore, with revisions to the March and April job reports, we’ve now seen 100,000 or more jobs added for three consecutive months.
In these three months, the S&P 500 gained 9.3%—a vindication of sorts for the bulls. Of course, robust earnings had more to do with the gains, but it’s nice to know that people can still find work against the backdrop of higher prices and affordability concerns.
In yesterday’s options trading, volume was 61.92 million, slightly higher than the 90-day average. Puts accounted for only 39% of the volume, compared to 61% for calls. Single-leg trades accounted for 55% of the volume. Approximately 53% had DTEs (days to expiration) of five days or less.
In my newsletter commentary about unusual options activity, I focus on DTEs of seven days or longer. I do that because I want to avoid the speculative nature of near-term DTEs and focus on the long-term investor.
Thursday’s unusual options activity was rather subdued for put options, with the highest Vol/OI (volume-to-open interest) the Cadence Design Systems’ Aug. 21 $370 put at 72.63.
Anytime you don’t have at least one over 100, you’re looking at subdued options activity, which is interesting, because the markets had a good day with the Dow up 1.73% to close at an all-time high.
For today’s commentary, I’ve got four puts that would make good cash-secured puts for income, value and growth.
Have an excellent weekend.
Ford (F)
Ford’s (F) June 12 $14.50 put had a Vol/OI ratio of 3.39 yesterday. The put accounted for just 2% of its total. Its total options volume was well below its 30-day average of 339,080. So, even though the put had volume more than three times the open interest, it wasn’t a big part of the Ford options story on the day. Rather, the day’s volume came down to diversification across all strike prices and DTEs.
Nonetheless, the annualized return provided on the premium was too much to pass up. As you can see below, F stock is down more than 2%, and the bid price is 5 cents higher, yielding an annualized return of 58.2% and a 76% likelihood that the share price will be above the $14.34 breakeven on June 26.
Ford stock is up over 48% in the past year, nearly double the S&P 500’s gains. The Barchart Technical Opinion is a 72% Strong Buy, while the analysts are lukewarm. Of the 23 analysts covering it, 5 rate it a Buy (3.17 out of 5) with a $13.90 target price, which is below its current price.
The big question right now with Ford is whether its EV business can ever turn a profit. In February, it said it would lose $4.25 billion (the midpoint of guidance) on EVs in 2026 and for another two years after that, breaking even around 2029.
However, the glass-half-full view is that the internal combustion business is doing relatively well, its energy storage business is coming along, and its warranty costs are falling, leading to higher profits in the years ahead.
With just a week to expiration, I wouldn’t be too concerned about a big drop in its share price.
Toast (TOST)
Toast’s (TOST) July 17 $21 put had a Vol/OI ratio of 5.28 yesterday. The put accounted for 13% of its volume on the day, which was well below its 30-day average of 24,155. TOST stock is down 30% in 2026 and 42% over the past year.
Toast stock is down nearly 3% in morning trading. That’s not surprising given the S&P is off more than 1% and the Nasdaq is down 2% on the day.
Due to the drop in stock prices, the bid price of $0.47 is higher than yesterday’s close, resulting in an annualized return of 19.9%, up 410 basis points. The $20.53 breakeven would be one of the lowest levels that it’s traded in the past 28 months.
I was in Toronto over Canada’s Victoria Day weekend a couple of weeks back. I got to see Toast’s software up close while ordering beers at Left Field Brewery in the Liberty Village neighborhood. You scan the QR code, place your order, and it opens a tab on your credit card in Apple Wallet. A server then delivers the beers, and you repeat the process until you’re ready to leave. Then, you check out. No muss, no fuss.
The best part: it worked your email into the process. I’ve been getting little blurbs about their beer ever since. Do I mind? Heck no. They provided friction-free service and good beer to boot.
Multiply that by 171,000 restaurants and bars, and you’ve got a business model with sticky revenue no matter what the SaaS bears have to say.
As cash-secured puts go, the July 17 $21 put is really enticing.
Microsoft (MSFT)
Microsoft’s (MSFT) July 10 $400 put had a Vol/OI ratio of 1.91 yesterday. The put’s volume was a rounding error for the tech behemoth’s 883,767 30-day volume. MSFT stock is down 13% in 2026, 10% over the past year, and is 23% off its July 2025 all-time high of $555.45.
Would I buy Microsoft stock at $394.50, its breakeven on the July 10 $400 cash-secured put? Despite the problems with OpenAI, you better believe it.
First, analysts still love it. Of the 49 covering MSFT, 44 rate it a Buy (4.73 out of 5), with a $554.28 target price, considerably higher than its current price. The highest target from an analyst is $680, 61% above its current price. I don’t know if it’s worth $680, but it’s definitely not a $400 stock either.
One thing that’s got me concerned is that TCI Fund Management cut its Microsoft holdings by 84% in Q1 2026. Founder and Chief Investment Officer Chris Hohn is a committed long-term investor. He holds positions for extended periods and manages a concentrated portfolio of just 10 stocks. He first invested in Microsoft in Q4 2017.
Despite capital expenditures of $97 billion in the 12 months ended March 31, it still generated $73 billion in free cash flow. The concerns about its AI spending and the returns from these investments are valid but likely overdone.
In five years, $400 should seem like a very good purchase price.
PVH (PVH)
As you can see above, PVH’s (PVH) June 18 $70 put had a Vol/OI ratio of 8.15 yesterday, placing it in the top 300 among put options. Its total options volume was 7,379, the second-highest daily volume in the past three months and 9.8 times its 30-day average. The June 18 $70 put accounted for nearly one-quarter of its daily volume.
As I write this early in Friday trading, PVH stock is up nearly a buck, and the bid price on the June 18 put has fallen to $0.20 from $0.35 at yesterday’s close. There’s been a small volume so far.
The annual return based on yesterday’s closing numbers was 13.0% [$0.35 bid price / $70 strike price - $0.35 bid price * 365 / 14]. With the 15-cent decline, the annualized return has dropped to 8.0%.
Normally, for a cash-secured put, you want the annualized return to be between 15% and 30% for a 30 to 45-day DTE. At 13 days, you’d ideally like it to be higher.
However, here’s why you might make an exception.
The idea of the cash-secured put is to generate some income while also buying a stock you want to own for the long haul at a lower price. In this case, it’s $69.80, about 14% lower than its current share price.
PVH stock took it on the chin yesterday, falling 20.2%, after reporting Q1 2026 results that beat analyst estimates for revenue and net income, but providing tentative guidance for the remainder of the fiscal year.
If PVH stock wasn’t cheap at $98, it is at $78. That’s 6.5 times its 2026 earnings per share of $11.95 at the midpoint of its guidance. At $69.80, that’s 5.8 times EPS.
Over the past five years, it’s rarely traded below $60, so even if you had an initial unrealized loss of $9.80 per share, I think you’d quickly get that back as the situation in the Middle East gets sorted and tariff refunds are confirmed.
On the date of publication, Will Ashworth did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
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