Covered Calls Positions Established in Halozyme Therapeutics Inc. and Match Group Inc.

Today Covered Calls positions were established in Halozyme Therapeutics Inc. (ticker HALO) and Match Group Inc. (MTCH) when my buy/write net debit limit orders were executed.  For Halozyme, 400 shares were purchased at $42.62 and four September 15th, 2023 Call options were sold at $3.36 per share at the $40.00 strike price.  For Match Group, 400 shares were purchased at $43.31 and four September 15th, 2023 Call options were sold at $2.17 per share at the $42.50 strike price.  In-the-money strike prices were established for both positions.  The probability that the stock will be called away (i.e. assigned) at their September 15th options expiration date for Halozyme was 74.1% and for Match Group was 59.5%.  Neither company pays a dividend and they do not report quarterly earnings prior to the options expiration date.

Halozyme Therapeutics is a small-cap biotechnology company that has a range of auto-injector devices for subcutaneous and intramuscular delivery to patients.  They have license agreements in partnership with several drug companies with 6 currently approved products and 15 more in development.  When co-formulated with drugs, their products have the potential to reduce the treatment burden for patients (minutes for subcutaneous injections versus hours for IV infusions).  I researched this company when it appeared as the top-ranked Healthcare sector company in my Growth at a Reasonable Price (GARP) stock screener.  I am also impressed by the leadership quality of CEO Helen Torley.  

The rankings and filters results for Halozyme from my GARP screener on StockRover are:

Also, the eleven analysts that cover Halozyme have an average target price is $54.20 which is +27.2% above today's purchase price.

Regarding Match Group: Three similar prior Covered Calls positions in the Match Group were assigned on their options expiration dates and I decided to follow-up today with a similar position since I remain bullish on the company's prospects.  The Match Group is the leading online dating services company worldwide including several brands that include Tinder, Match, and Hinge.  Match is profitable and their earnings per share and revenues seem to be at an inflection point where they have begun to obtain regular quarterly revenue and profit increases based on their worldwide presence and their growth opportunities (especially in Asia but also in Europe).  The primary catalyst for my increasing optimism stems primarily from the leadership of their relatively new CEO, Bernard Kim, who has been in his new position for only slightly more than one year now but who has previously demonstrated outstanding performance in his prior CEO role at Zynga.  In addition, Match meets all five of my current primary evaluation criteria for identifying worthwhile candidates for investing:

The transactions and potential results for both positions are included in the details presented below:

1. Halozyme Therapeutics Inc. (HALO) -- New Covered Calls Position

The net debit buy/write limit order was executed as follows:

8/25/2023 Bought 400 shares of Halozyme Therapeutics stock @ $42.62 per share.  
8/25/2023 Sold 4 HALO September 15th, 2023 $40.00 Call options @ $3.36 per share.
Note: the Implied Volatility of the Calls was 38.8 when this position was established.  

A possible overall performance result (including commissions) if this position is assigned on its 9/15/2023 options expiration date is follows:
Halozyme Covered Calls Net Investment: $15,706.68
= ($42.62 - $3.36) * 400 shares + $2.68 commission

Net Profit Components:
(a) Options Income: +$1,341.32
= ($3.36 * 400 shares) - $2.68 commission
(b) Dividend Income: +$0.00
(c) Capital Appreciation (If Halozyme stock is above the $40.00 strike price at the September 15th expiration): -$1,048.00
= ($40.00 - $42.62) * 400 shares

Potential Total Net Profit (If assigned at expiration): +$293.32
= (+$1,341.32 options income + $0.00 dividend income - $1,048.00 capital appreciation)

Potential Absolute Return-on-Investment: +1.9%
= +$293.32/$15,706.68
Potential Equivalent Annualized-Return-on-Investment: +32.5%
= (+$293.32/$15,706.68) * (365/21 days)

2. Match Group Inc. (MTCH) -- New Covered Calls Position

The buy/write transaction was:
8/25/2023 Bought 400 Match Group Inc. shares @ $43.31
8/25/2023 Sold 4 MTCH 9/15/2023 $42.50 Call options @ $2.17 per share.

A possible overall performance result (including commissions) for this Match Group Covered Calls position is as follows:
Match Group Covered Calls Net Investment: $16,458.68
= ($43.31 - $2.17) * 400 shares + $2.68 commission

Net Profit:
(a) Options Income: +$865.32
= ($2.17 * 400 shares) - $2.68 commission
(b) Dividend Income: +$0.00
= ($0.00 dividends per share x 400 shares)
(c) Capital Appreciation (If MTCH shares assigned at $42.50 strike price at expiration): -$324.00
+($42.50 - $43.31) * 400 shares

Total Net Profit (If options exercised on the 9/15/2023 options expiration date): +$541.32

= (+$865.32 options income +$0.00 dividend income -$324.00 capital appreciation)

Potential Absolute Return-on-Investment (If the Match Group Inc. shares are assigned at the $42.50 strike price at the Sept. 15th, 2023 options expiration date): +3.3%

= +$541.32/$16,458.68

Potential Annualized Return-on-Investment (If 400 Match Group shares assigned at $42.50 at the 9/15/2023 options expiration): +57.2%

= (+$541.32/$16,458.68) * (365/21 days)