How Options Traders Should Target This Grocery Stock

United Natural Foods stock has been on a hot streak lately

facebook X logo linkedin

On Oct. 14, when Kroger (KR) and Albertson's (ACI) announced their massive merger, sector peer United Natural Foods (NASDAQ:UNFI) shed 2.2%. While that mega-merger is facing legal and antitrust hurdles, UNFI has strung together three straight weekly wins. 

The food retailer --with over 30,000 locations throughout the U.S. and Canada -- is still down 15.5% in 2022, but now has tacked on 20% this quarter alone. Amid its torrid rally from a Sept. 29 multi-year bottom of $32.90, the shares are facing off with their 200-day moving average. Despite the technical troubles, United Natural Foods offers a cheap valuation at a forward price-earnings ratio of 8.2 and a price-sales ratio of 0.09.

UNFI Stock

Although the business is expected to generate a relatively slow growth rate, its expected consistency makes the stock’s valuation appealing. However, United Natural Foods’ biggest fundamental issue is its balance sheet. It currently holds just $47 million in cash and $3.38 billion in total debt, outnumbering UNFI’s market cap of $2.4 billion by nearly $1 billion. Nonetheless, United Natural Foods continues to be a relatively safe investment from a risk-reward perspective due to its low price.

UNFI options look well-priced at the moment, too. The stock's Schaeffer's Volatility Index (SVI) of 45% stands higher than 10% of all other readings in its annual range, implying that options players are pricing in low volatility expectations. It's also worth pointing out that the equity ranks low on the Schaeffer's Volatility Scorecard (SVS), with a score of just 16 out of 100. In other words, the security has consistently realized lower volatility than its options have priced in, making the stock a potential premium-selling candidate.


Target Effortless Triple-Digit Gains Every Sunday Evening For Life!

This is your chance to triple your profit potential on Sunday evenings, without spending all your free time watching the market.

On Sundays, as a Weekend Plus subscriber, you’ll get up to 6 trades every Sunday, each targeting gains of 200% or more.

Start targeting gains like the ones our subscribers have seen recently, including:

213.3% GAIN on AutoNation calls
100.0% GAIN on Monster Beverage calls
100.4% GAIN on Walgreens Boots Alliance puts
100.4% GAIN on ON Semiconductor calls
257.7% GAIN on Dell calls

101.0% GAIN on Apollo Global Management calls
103.6% GAIN on JP Morgan  Chase calls
105.3% GAIN on DraftKings calls
101.3% GAIN on Airbnb calls
203.0% GAIN on Shopify calls
102.0% GAIN on Cboe Global Markets calls
100.9% GAIN on Boeing calls
102.1% GAIN on Microsoft puts
102.3% GAIN on First Solar calls
101.5% GAIN on PulteGroup calls
101.0% GAIN on Apple calls
209.4% GAIN on NXP Semiconductors calls
100.8% GAIN on Uber Technologies calls
100.4% GAIN on Academy Sports and Outdoors puts
102.2% GAIN on Trade Desk calls
100.8% GAIN on DoorDash calls
100.0% GAIN on Camping World Holdings puts
100.0% GAIN on Cboe Global Markets calls
100.2% GAIN on calls
238.5% GAIN on Oracle calls



Rainmaker Ads CGI