Established Covered Call Position in Gilead Sciences Inc.

In this morning's trading session, a Covered Call position was established in Gilead Sciences Inc. (ticker symbol GILD) when the Covered Calls Advisor's buy/write net debit limit order was executed. One hundred shares were purchased at $146.39 and one March 20th, 2026 Call option was sold at $7.87 per share at the $140.00 strike price.  Therefore, a net debit price of $138.52 which is a time value of $1.48 per share [$7.87 Call option price - ($146.39 stock price - $140.00 strike price)].  This is a moderately in-the-money position since its probability of closing in-the-money on the 3/20/2026 options expiration date was 73.1% when this position was established.  The current average target price of the analysts covering Gilead is $157.08 which is +7.3% above today's stock purchase price.  

Gilead Sciences Inc. is a U.S.-based biopharmaceutical company headquartered in Foster City, California, that develops and commercializes medicines for serious diseases including HIV, viral hepatitis, cancer, and other life-threatening conditions, with the core of its portfolio focused on HIV and hepatitis B and C.  Founded in 1987, it has become a leading player in antiviral therapies and oncology, with a strong global presence and significant investment in research and development. Gilead focuses on innovative drug discovery, strategic acquisitions, and expanding global access to treatment while maintaining a robust clinical pipeline.

Two potential return-on-investment results for this position are highlighted below and includes the possibility of early assignment since a quarterly ex-dividend of $.82 per share (2.2% annualized dividend yield) goes ex-dividend on March 13th (which is prior to the March 20th options expiration date).  Either an early assignment or an assignment on the options expiration date would be a desirable return-on-investment result since they both exceed my preferred minimum annualized return-on-investment criteria (see criteria #8 and #9 at the bottom of this post) when using my nine Dividend Capture Strategy criteria (see here).  Also, as I prefer, there is no intervening quarterly earnings report since Gilead's next quarterly earnings report on April 23rd, 2026 is after this position's March 20th, 2026 options expiration date.

  

As detailed below, two potential return-on-investment results are: 

•  +1.1% absolute return (equivalent to +38.6% annualized return-on-investment for the next 10 days) if the stock is assigned early (business day prior to the March 13th, 2026 ex-dividend date); OR 

• +1.7% absolute return (equivalent to +35.5% annualized return-on-investment over the next 17 days) if the stock is assigned on the March 20th, 2026 options expiration date.

Gilead Sciences Inc. (GILD) -- New Covered Call Position
The buy/write transaction was:
3/3/2026 Bought 100 Gilead Sciences Inc. shares @ $146.39
3/3/2026 Sold 1 Gilead 3/20/2026 $140.00 Call option @ $7.87 per share.  The Implied Volatility of the Call was 31.6 when this transaction occurred which, as I prefer, is above the current S&P 500 Volatility Index (i.e. VIX) of 24.2.
3/13/2026 Upcoming quarterly ex-dividend of $.82 per share

Two possible overall performance results (including commissions) for this Gilead Sciences Covered Call position are as follows:
Covered Call Net Investment: $13,852.67
= ($146.39 - $7.87) * 100 shares + $.67 commission

Net Profit Components:
(a) Options Income: +$786.33
= ($7.87 * 100 shares) - $.67 commission
(b) Dividend Income (If option exercised early on March 12th, the last business day prior to the March 13th ex-div date): +$0.00; or
(b) Dividend Income (If Gilead stock assigned at the March 20th, 2026 options expiration date): +$82.00
= ($.82 dividend per share x 100 shares)
(c) Capital Appreciation (If Gilead Call option assigned early): -$639.00
+($140.00 strike price - $146.39 stock purchase price) * 100 shares; or
(c) Capital Appreciation (If shares assigned at $140.00 strike price at options expiration): -$639.00 = +($140.00 - $146.39) * 100 shares

1. Total Net Profit [If option exercised early]: +$147.33

= (+$786.33 option income +$0.00 dividend income - $639.00 capital appreciation); or

2. Total Net Profit (If Gilead shares assigned at $140.00 strike on the March 20th options expiration date): +$229.33

= (+$786.33 option income +$82.00 dividend income - $639.00 capital appreciation)

1. Absolute Return-on-Investment [If option exercised early on March 12th (business day prior to the March 13th ex-dividend date)]: +1.1%

= +$147.33/$13,852.67

Annualized Return-on-Investment (If option exercised early): +38.8%

= (+$147.33/$13,852.67) * (365/10 days); or

2. Absolute Return-on-Investment (If Gilead shares assigned at the $140.00 strike price at the March 20th, 2026 options expiration date): +1.7%

= +$229.33/$13,852.67

Annualized Return-on-Investment (If Gilead shares assigned at $140.00 at the 3/20/2026 options expiration): +35.5%

= (+$229.33/$13,852.67) * (365/17 days)

At least eight of the nine metrics used in the Covered Calls Advisor's Dividend Capture Strategy spreadsheet (see below) must be 'YES' prior to establishing a new Covered Calls position using the Covered Calls Advisor's Dividend Capture strategy.  All nine criteria are achieved for this Gilead Sciences Inc. Covered Call position.

Early Assignment of Covered Calls Position in Newmont Corporation

I was notified via email early this morning by my broker (Schwab) that the two Newmont Corporation (ticker NEM) March 6th, 2026 Call options were exercised early yesterday.  Newmont's stock price increased from $120.25 when this position was established to $128.47 at yesterday's market close.  The original $2.59 time value in the Calls when the position was established had declined on yesterday's market close to close to $0.00 per share.  So, with 3 days remaining until this Friday's March 6th options expiration date, the owner of these Calls exercised their option to buy the 200 shares at the $115.00 strike price in order to receive today's $.26 per share ex-dividend.  

Although I will not receive the ex-dividend, I am pleased with the +76.2% annualized-return-on-investment (aroi) result achieved since it exceeded the maximum aroi that might have been achieved if this position instead had remained in-the-money and would therefore be assigned on the March 6th options expiration date.   

The post when this Newmont Corporation Covered Calls position was originally established is here.  

As detailed below, the return-on-investment result for this Newmont Corporation Covered Calls position was +2.3% absolute return in 11 days (equivalent to a +76.2% annualized return-on-investment).

Newmont Corporation (NEM) -- Covered Calls Position Closed Out by Early Assignment
The buy/write transaction was:
2/20/2026 Bought 200 Newmont Corp shares @ $120.25.
2/20/2026 Sold 2 Newmont 3/6/2026 $115.00 Call options @ $7.84.
Note: the Implied Volatility of the Call options was 48.3% when this buy/write transaction was executed.
3/3/2026 Early Assignment of these two Newmont Call options, so the Calls expired and 200 NEM shares were sold at the $115.00 strike price.

The overall performance results (including commission) for this Wells Fargo Covered Calls position are as follows:
Covered Calls Net Investment: $22,483.34
= ($120.25 - $7.84) * 200 shares + $1.34 commission

Net Profit Components:
(a) Options Income: +$1,566.66
= ($7.84 * 200 shares) - $1.34 commission
(b) Dividend Income (Two NEM Call options exercised early on March 2nd, the last business day prior to the March 3rd ex-dividend date): +$0.00
(c) Capital Appreciation (Newmont Call options assigned early on March 3rd): -$1,050.00
= +($115.00 strike price - $120.25 stock purchase price) * 200 shares

Total Net Profit: +$516.66

= (+$1,566.66 options income + $0.00 dividend income - $1,050.00 capital appreciation)

Absolute Return-on-Investment: +2.3%

= +$516.66/$22,483.34

Annualized Return-on-Investment: +76.2%

= (+$516.66/$22,483.34) * (365/11 days)

February 27th, 2026 Options Expiration Results

The Covered Calls Advisor Portfolio had three Covered Calls positions with February 27th, 2026 options expiration dates.  Two positions (Amazon.com Inc. and RTX Corporation), closed in-the-money so their Calls expired and the shares were called away (i.e. sold) at their respective strike prices.  One position in Capital One Financial Corporation closed out-of-the-money so its Call option expired and the shares remain in the Covered Calls Advisor Portfolio.  A summary of results for each of these positions (in alphabetical order) is as follows:

1. Amazon.com Inc. (AMZN) -- +1.9% absolute return (equivalent to +49.6% annualized return-on-investment) for the 14 days of this investment.  This Covered Call position was assigned at the $192.50 strike price since the stock closed in-the-money at $210.00 per share.  The original blog post detailing this Covered Call position is here. 

2. Capital One Financial Corporation (COF) -- This Covered Call position closed yesterday at $195.64 which was well below its $210.00 strike price, so the one Call option expired and 100 Capital One shares now remain in the Covered Calls Advisor Portfolio.  The original blog post detailing this position is here.  Early in this upcoming week I will decide to either continue this Covered Call position by selling a Call option against the 100 Capital One shares currently held or close out the position by selling these shares. 

3. RTX Corporation (RTX) -- +2.1% absolute return (equivalent to +42.7% annualized return-on-investment) for the 18 days of this investment.  This Covered Call position was assigned at the $195.00 strike price since the stock closed in-the-money at $202.62 per share.  The most recent blog post detailing this Covered Call position is here. 

As always, I welcome your feedback or questions at my email address shown below on anything related to the Covered Calls investing strategy.

Jeff Partlow
The Covered Calls Advisor
partlow@cox.net

Established Covered Calls in NVIDIA Corporation

Early in this morning's trading session, I established a Covered Calls position of 14 days duration in NVIDIA Corporation (ticker NVDA).  My net buy/write limit order at $175.67 was executed by simultaneously purchasing two hundred shares at $180.02 and selling two March 13th, 2026 weekly Call options at $4.35 per share and at the $185.00 strike price. A moderately out-of-the-money (strike price above the stock purchase price) Covered Calls position was established with the probability that NVIDIA's stock will close in-the-money (i.e. above the $185.00 strike price) on the 3/13/2026 options expiration date was 37.6% when this transaction was executed. 

NVIDIA reported their Q4 earnings after the market close two days ago. They substantially beat analysts' estimates on all relevant metrics including both earnings and revenue (which at $68.1 billion was 72.4% above the comparable quarter last year). In addition, their next quarter guidance at $78 billion is 76.9% above last year.  Very surprisingly, their stock reacted very negatively yesterday.  But I agree with the numerous sell-side equity research firms that raised their NVIDIA post-earnings target prices to approximately +40% above the $180.02 price I paid today.  In short, I decided that the negative price reaction to earnings is unwarranted -- so this morning I established this new Covered Calls position. 

As detailed below, two potential return-on-investment results are: (1) +2.5% absolute return-on-investment (equivalent to +64.6% annualized return-on-investment for the next 14 days) if NVIDIA's share price is unchanged at the $180.02 stock purchase price on the March 13th, 2026 options expiration date; and  (2) +5.3% absolute return-on-investment (equivalent to +138.5% annualized return-on-investment for the next 14 days) if NVIDIA's share price is in-the-money (i.e. above the $185.00 strike price) and therefore assigned on its March 13th, 2026 options expiration date.  

NVIDIA Corporation (NVDA) -- New Covered Call Position

Today's buy/write net limit order transaction was as follows:
2/27/2026 Bought 200 NVIDIA Corporation shares at $180.02.

2/27/2026 Sold 2 NVIDIA 3/13/2026 $185.00 Call options @ $4.35 per share.  The Implied Volatility of these Calls was 44.8 when this position was established, well above (as preferred) the VIX which was at 20.7.  
3/11/2026 Ex-dividend of $.01 per share.  This miniscule dividend amount for the largest market cap company is ludicrous. 🤣

Two possible overall performance results (including commissions) for this NVIDIA Corporation Covered Calls position is as follows:
Covered Calls Net Investment: $35,135.34
= ($180.02 - $4.35) * 200 shares + $1.34 commission

Net Profit:
(a) Options Income: +$868.66
= ($4.35 * 200 shares) - $1.34 commission
(b) Dividend Income: +$2.00 = $.01 per share x 200 shares
(c) Capital Appreciation (If 200 NVIDIA shares close at the unchanged purchase price of $180.02 per share on the 3/13/2026 options expiration date): +$0.00
+($180.02 closing price at expiration - $180.02 stock purchase price) * 200 shares; or
(c) Capital Appreciation (If 200 NVIDIA shares assigned (i.e. above the $185.00 strike price) on the 3/13/2026 options expiration date): +$996.00
+($185.00 strike price - $180.02 stock purchase price) * 200 shares

1. Total Net Profit Potential (If stock price closes at the unchanged purchase price of $180.02 per share on the 3/11/2026 options expiration date): +$870.66
= (+$868.66 option income + $2.00 dividend income + $0.00 capital appreciation)
2. Total Net Profit Potential (If 200 NVIDIA shares assigned at the $185.00 strike price on the 3/13/2026 options expiration date): +$1,866.66

= (+$868.66 option income + $2.00 dividend income + $996.00 capital appreciation)

1. Potential Absolute Return-on-Investment (If 200 NVDA shares closing price is unchanged at the original purchase price of $180.02 per share on the 3/11 options expiration date): +2.5%
= +$870.66/$35,135.34
Potential Annualized Return-on-Investment (If 200 NVIDIA shares closing price is unchanged at the original $180.02 stock purchase price on the 3/11/2026 options expiration date): +64.6%
= (+$870.66/$35,135.34) * (365/14 days)

2. Potential Absolute Return-on-Investment (If 200 NVIDIA shares assigned (i.e. sold) at the $185.00 strike price on the 3/11/2026 options expiration date): +5.3%
= (+$1,866.66/$35,135.34)

Potential Annualized Return-on-Investment (If 200 NVIDIA shares assigned at the $185.00 strike price on the 3/11/2026 options expiration date): +138.5%
= (+$1,866.66/$35,135.34) * (365/14 days)