LSTR Butterfly Strategy
LSTR (Landstar System, Inc.), in the Industrials sector, (Integrated Freight & Logistics industry), listed on NASDAQ.
Landstar System, Inc. provides integrated transportation management solutions in the United States, Canada, Mexico, and internationally. The company operates through two segments: Transportation Logistics, and Insurance. The Transportation Logistics segment offers a range of transportation services, including truckload and less-than-truckload transportation, rail intermodal, air cargo, ocean cargo, expedited ground and air delivery of time-critical freight, heavy-haul/specialized, U.S.-Canada and U.S.-Mexico cross-border, intra-Mexico, intra-Canada, project cargo, and customs brokerage, as well as offers transportation services to other transportation companies, such as third party logistics, small package and less-than-truckload service providers. It provides truck services through dry and specialty vans of various sizes, unsided/platform trailers, temperature-controlled vans, and containers; rail intermodal services through contracts with domestic and Canadian railroads; and air and ocean services through contracts with domestic and international airlines and ocean lines. This segment serves the automotive parts and assemblies, consumer durables, building products, metals, chemicals, foodstuffs, heavy machinery, retail, electronics, and military equipment industries. The Insurance segment reinsures certain risks of the company's independent contractors.
LSTR (Landstar System, Inc.) trades in the Industrials sector, specifically Integrated Freight & Logistics, with a market capitalization of approximately $5.94B, a trailing P/E of 47.77, a beta of 0.85 versus the broader market, a 52-week range of 119.32-195.84, average daily share volume of 489K, a public-listing history dating back to 1993, approximately 1K full-time employees. These structural characteristics shape how LSTR stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 0.85 places LSTR roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline. The trailing P/E of 47.77 is on the rich side, which tends to correlate with higher earnings-window IV expansion as the market debates whether forward growth supports the multiple. LSTR pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a butterfly on LSTR?
A long call butterfly buys one lower-strike call, sells two ATM calls, and buys one higher-strike call, paying a small net debit for a defined-risk position that maxes out if the underlying pins the middle strike at expiration.
Current LSTR snapshot
As of May 15, 2026, spot at $176.70, ATM IV 38.20%, IV rank 48.15%, expected move 10.95%. The butterfly on LSTR below is built from the same end-of-day chain, with strikes snapped to listed contracts and premiums pulled from the bid/ask midpoint at a 34-day expiry.
Why this butterfly structure on LSTR specifically: LSTR IV at 38.20% is mid-range versus its 1-year history, so strategy selection should anchor more to the directional thesis than to the IV regime, with a market-implied 1-standard-deviation move of approximately 10.95% (roughly $19.35 on the underlying). The 34-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated LSTR expiries trade a higher absolute premium for lower per-day decay. Position sizing on LSTR should anchor to the underlying notional of $176.70 per share and to the trader's directional view on LSTR stock.
LSTR butterfly setup
The LSTR butterfly below is built from the end-of-day chain, with each option leg priced at the bid/ask midpoint of its listed strike. With LSTR near $176.70, the first option leg uses a $170.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed LSTR chain at a 34-day expiry; the cross-strike IV skew is reflected directly in the per-leg values rather than approximated. Quantity sizing assumes one contract per option leg (or 100 LSTR shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 1 | Call | $170.00 | $11.90 |
| Sell 2 | Call | $175.00 | $8.70 |
| Buy 1 | Call | $185.00 | $4.85 |
LSTR butterfly risk and reward
- Net Premium / Debit
- +$65.00
- Max Profit (per contract)
- $483.29
- Max Loss (per contract)
- -$435.00
- Breakeven(s)
- $180.65
- Risk / Reward Ratio
- 1.111
Max profit equals the wing width minus net debit times 100 (reached when the underlying pins the middle strike); max loss equals the net debit times 100. Two breakevens at lower-wing plus debit and upper-wing minus debit.
LSTR butterfly payoff curve
Modeled P&L at expiration across a range of underlying prices for the butterfly on LSTR. Each row is one sampled price point from the computed payoff curve; the full curve uses 200 price points internally before being summarized into 10 rows here.
| Underlying Price | % From Spot | P&L at Expiration |
|---|---|---|
| $0.01 | -100.0% | +$65.00 |
| $39.08 | -77.9% | +$65.00 |
| $78.15 | -55.8% | +$65.00 |
| $117.21 | -33.7% | +$65.00 |
| $156.28 | -11.6% | +$65.00 |
| $195.35 | +10.6% | -$435.00 |
| $234.42 | +32.7% | -$435.00 |
| $273.49 | +54.8% | -$435.00 |
| $312.56 | +76.9% | -$435.00 |
| $351.62 | +99.0% | -$435.00 |
When traders use butterfly on LSTR
Butterflies on LSTR are pinning bets - traders use them when they expect LSTR to settle near a specific level at expiration (often the prior close, a round number, or the max-pain strike) and want defined-risk exposure to that outcome.
LSTR thesis for this butterfly
The market-implied 1-standard-deviation range for LSTR extends from approximately $157.35 on the downside to $196.05 on the upside. A LSTR long call butterfly is a pinning play: it pays maximum at the middle strike if LSTR settles there at expiration, with the wing legs capping both the cost and the maximum loss to the net debit. Current LSTR IV rank near 48.15% is mid-range against its 1-year distribution, so the IV signal is neutral; the butterfly thesis on LSTR should anchor more to the directional view and the expected-move geometry. As a Industrials name, LSTR options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to LSTR-specific events.
LSTR butterfly positions are structurally neutral / pin (limited-risk, limited-reward); the modeled P&L assumes European-style exercise at expiration and ignores early assignment, transaction costs, dividends paid before expiry on the stock leg (when present), and the bid-ask spread on the listed chain. LSTR positions also carry Industrials sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move LSTR alongside the broader basket even when LSTR-specific fundamentals are unchanged. Always rebuild the position from current LSTR chain quotes before placing a trade.
Frequently asked questions
- What is a butterfly on LSTR?
- A butterfly on LSTR is the butterfly strategy applied to LSTR (stock). The strategy is structurally neutral / pin (limited-risk, limited-reward): A long call butterfly buys one lower-strike call, sells two ATM calls, and buys one higher-strike call, paying a small net debit for a defined-risk position that maxes out if the underlying pins the middle strike at expiration. With LSTR stock trading near $176.70, the strikes shown on this page are snapped to the nearest listed LSTR chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are LSTR butterfly max profit and max loss calculated?
- Max profit equals the wing width minus net debit times 100 (reached when the underlying pins the middle strike); max loss equals the net debit times 100. Two breakevens at lower-wing plus debit and upper-wing minus debit. For the LSTR butterfly priced from the end-of-day chain at a 30-day expiry (ATM IV 38.20%), the computed maximum profit is $483.29 per contract and the computed maximum loss is -$435.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a LSTR butterfly?
- The breakeven for the LSTR butterfly priced on this page is roughly $180.65 at expiration, derived from end-of-day chain premiums. Breakeven is the underlying price at which the strategy's P&L crosses zero ignoring transaction costs and assignment risk. The current LSTR market-implied 1-standard-deviation expected move is approximately 10.95%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a butterfly on LSTR?
- Butterflies on LSTR are pinning bets - traders use them when they expect LSTR to settle near a specific level at expiration (often the prior close, a round number, or the max-pain strike) and want defined-risk exposure to that outcome.
- How does current LSTR implied volatility affect this butterfly?
- LSTR ATM IV is at 38.20% with IV rank near 48.15%, which is mid-range against its 1-year history. Strategy selection depends more on directional thesis and expected move than on a strong IV signal.