Salesforce, Inc. (CRM), Trending Stock Report

Salesforce, Inc. (CRM) share prices are compressed. CRM is also trending in the news. Many of the news headlines talk about how the company will use AI tools in its software. From the many stories, it looks like CRM is still working to develop a clear AI strategy.

While the AI hype around the company is not certain, the options prices are certainly less expensive than they should be given the stock’s history after past compression signals. Just look at the charts below. The moves in 2014 and 2015 after the compression signals were wildly profitable. The move after the the signal in May of this year was insanely profitable.

This Volatility Term Structure chart for CRM shows us the implied volatility for the at-the-money options for each expiration. This chart shows that options expiring on October 18^th have the lowest volatility expectations. Low volatility expectations mean low options prices. This monthly expiration term also has good liquidity and that increases our chances of getting filled at a good price.

This MDM graph compares the modeled expected distribution for future stock prices (the orange line) with the actual distribution of CRM’s share prices over the past 3 years (the blue histogram). You can see that the actual stock movement shows that the stock tends to make bigger moves than current options prices expect.

This Volatility Cone chart for CRM compares implied volatility expectations for each term to the historical volatility for that same term. The blue line shows the average historical volatility, the purple lines show each HV measure’s highest high and the lowest low over the past 3 years. You can see that the one-month term (which is the term we are interested in) is below the 3-year historical average. This confirms that the options for that term are relatively inexpensive.

CRM share prices are compressed. The stock is trending in the news with a lot of AI hype. Options for the October 18^th expiration are relatively cheap with good liquidity. This is an option buying situation.

To get the specific details and prices on today’s trade ideas, be sure to read today’s ODDS Online Daily Option Trade Idea.