To The Moon

You could buy 100 shares of $Amazon.com(AMZN)$ for roughly $26,600 today. Or you could sell the January 15, 2027 $250 put and collect approximately $720 in premium while waiting for a better entry.

Amazon sold off following its October 29 earnings report. Earnings missed estimates, and management indicated that 2027 capital spending would be meaningfully higher than this year's roughly $220B.

Shares fell to around $229 the following day, then rallied approximately 16% from that low. They now trade near $266, about 7% below their 52-week high.

The underlying business continues to grow. AWS revenue increased 39% to $46B last quarter, while its backlog reached $578B.

With the stock recovering, this put-selling strategy offers a way to get paid while waiting for a potential entry.

The Setup

• Strike: $250

• Expiration: January 15, 2027

• Premium collected: ~$720

• Implied volatility: ~33%

• Delta: 0.29

• Time to expiration: 65 days

• Strike price: ~6% below the current share price

• Return on capital: 2.9%, or approximately 16% annualized

Amazon's next earnings report is expected in early February, after this put expires.

The Trade Management Plan

The initial profit target is 50% of the maximum premium.

If the put can be bought back for around $3.60, you would have captured half the original credit. That could happen well before expiration, allowing you to close the position and free up capital.

If $AMZN falls toward $250 and the original investment thesis remains intact, you could consider rolling the position down and out for additional credit.

If assigned, you would buy 100 shares at an effective cost basis of $242.80 — approximately 8.7% below today's share price. From there, you could begin selling covered calls.