MED Bull Call Spread Strategy
MED (Medifast, Inc.), in the Consumer Cyclical sector, (Personal Products & Services industry), listed on NYSE.
Medifast, Inc., through its subsidiaries, manufactures and distributes weight loss, weight management, healthy living products, and other consumable health and nutritional products in the United States and the Asia-Pacific. The company offers bars, bites, pretzels, puffs, cereal crunch, drinks, hearty choices, oatmeal, pancakes, pudding, soft serves, shakes, smoothies, soft bakes, and soups under the OPTAVIA, Optimal Health by Take Shape for Life, and Flavors of Home brands. It markets its products through point-of-sale transactions over ecommerce platform. The company was founded in 1980 and is headquartered in Baltimore, Maryland.
MED (Medifast, Inc.) trades in the Consumer Cyclical sector, specifically Personal Products & Services, with a market capitalization of approximately $138.8M, a beta of 0.57 versus the broader market, a 52-week range of 9.22-15.46, average daily share volume of 255K, a public-listing history dating back to 1993, approximately 504 full-time employees. These structural characteristics shape how MED stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 0.57 indicates MED has historically moved less than the broader market, dampening realized volatility and producing tighter expected-move bands per unit of dollar exposure.
What is a bull call spread on MED?
A bull call spread buys an at-the-money call and sells an out-of-the-money call at a higher strike for defined risk and defined reward bounded by the strike width.
Current MED snapshot
As of May 15, 2026, spot at $12.59, ATM IV 17.50%, IV rank 0.49%, expected move 5.02%. The bull call spread on MED 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 bull call spread structure on MED specifically: MED IV at 17.50% is on the cheap side of its 1-year range, which favors premium-buying structures like a MED bull call spread, with a market-implied 1-standard-deviation move of approximately 5.02% (roughly $0.63 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 MED expiries trade a higher absolute premium for lower per-day decay. Position sizing on MED should anchor to the underlying notional of $12.59 per share and to the trader's directional view on MED stock.
MED bull call spread setup
The MED bull call spread below is built from the end-of-day chain, with each option leg priced at the bid/ask midpoint of its listed strike. With MED near $12.59, the first option leg uses a $12.59 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed MED 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 MED shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 1 | Call | $12.59 | N/A |
| Sell 1 | Call | $13.22 | N/A |
MED bull call spread risk and reward
- Net Premium / Debit
- N/A
- Max Profit (per contract)
- Unbounded
- Max Loss (per contract)
- Unbounded
- Breakeven(s)
- None on modeled curve
- Risk / Reward Ratio
- N/A
Max profit equals strike width minus net debit times 100; max loss equals net debit times 100. Breakeven is long-call strike plus net debit.
MED bull call spread payoff curve
Modeled P&L at expiration across a range of underlying prices for the bull call spread on MED. 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.
When traders use bull call spread on MED
Bull call spreads on MED reduce the cost of a bullish MED stock position by selling a higher-strike call; suited to moderate-move theses where price reaches but does not vastly exceed the short strike.
MED thesis for this bull call spread
The market-implied 1-standard-deviation range for MED extends from approximately $11.96 on the downside to $13.22 on the upside. A MED bull call spread caps both the risk and the reward of a bullish position; relative to an outright long call on MED, the spread reduces the cost basis but limits the maximum profit to the strike width minus net debit. Current MED IV rank near 0.49% sits in the lower third of its 1-year distribution, where IV often re-expands toward the mean; this favors premium-buying structures and disadvantages premium-selling structures on MED at 17.50%. As a Consumer Cyclical name, MED options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to MED-specific events.
MED bull call spread positions are structurally moderately bullish; 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. MED positions also carry Consumer Cyclical sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move MED alongside the broader basket even when MED-specific fundamentals are unchanged. Long-premium structures like a bull call spread on MED are particularly exposed to IV-crush risk through scheduled events (earnings, FDA decisions, central-bank meetings) where IV typically contracts post-event regardless of the directional outcome. Always rebuild the position from current MED chain quotes before placing a trade.
Frequently asked questions
- What is a bull call spread on MED?
- A bull call spread on MED is the bull call spread strategy applied to MED (stock). The strategy is structurally moderately bullish: A bull call spread buys an at-the-money call and sells an out-of-the-money call at a higher strike for defined risk and defined reward bounded by the strike width. With MED stock trading near $12.59, the strikes shown on this page are snapped to the nearest listed MED chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are MED bull call spread max profit and max loss calculated?
- Max profit equals strike width minus net debit times 100; max loss equals net debit times 100. Breakeven is long-call strike plus net debit. For the MED bull call spread priced from the end-of-day chain at a 30-day expiry (ATM IV 17.50%), the computed maximum profit is unbounded per contract and the computed maximum loss is unbounded per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a MED bull call spread?
- The breakeven for the MED bull call spread priced on this page is no defined breakeven on the modeled curve 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 MED market-implied 1-standard-deviation expected move is approximately 5.02%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a bull call spread on MED?
- Bull call spreads on MED reduce the cost of a bullish MED stock position by selling a higher-strike call; suited to moderate-move theses where price reaches but does not vastly exceed the short strike.
- How does current MED implied volatility affect this bull call spread?
- MED ATM IV is at 17.50% with IV rank near 0.49%, which is on the low end of its 1-year range. Premium-buying structures (long call, long put, debit spreads) are relatively cheap in this regime; premium-selling structures collect less credit per unit risk.