Covered Calls Position Established in Halozyme Therapeutics Inc.

Today a Covered Calls position was established in Halozyme Therapeutics Inc. (ticker HALO) when four hundred shares were purchased at $52.29 and four July 18th, 2025 Call options were sold at $3.35 per share at the $50.00 strike price. So, the corresponding potential time value (aka extrinsic value) profit potential is $1.06 per share = [$3.30 Call options premium - ($52.29 stock purchase price - $3.35 strike price)].  An in-the-money Covered Calls position was established with the probability that the Calls will be in-the-money and thus the stock would be assigned at $50.00 per share on the options expiration date was 68.5% when this position was established.  Halozyme does not pay a dividend and importantly, their next quarterly earnings report on August 5th, 2025 is after the July 18th, 2025 options expiration date.

A comparison between whether a Covered Calls or a Cash-Secured Puts position would be preferable was made shortly before I entered this order.  The decision was an easy one since the time value for the Calls was substantially higher than that of the comparable Puts.

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 11 currently approved products.  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).  Also, I am very impressed by the leadership qualities of their CEO Helen Torley, who has done an outstanding job during her decade-long tenure as CEO.

If interested in additional information on Halozyme, their most recent presentation in conjunction with their most recent earnings report for Q1 2025 is here.

  

There are 28 companies that passed all criteria today in my Quality+Value+Growth stock screener.  Halozyme not only was one of these 28 companies, but it also ranked #1 overall among them.  Their outputs from this screener is shown on this chart:  

As detailed below, a potential return-on-investment result is +2.2% absolute return-on-investment (equivalent to +31.4% annualized return-on-investment for the next 25 days) if the Halozyme share price is in-the-money (i.e. above the $50.00 strike price) and the stock is therefore assigned on its July 18th, 2025 options expiration date. 

 

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

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

6/23/2025 Bought 400 shares of Halozyme Therapeutics stock @ $52.29 per share.  
6/23/2025 Sold 4 HALO July 18th, 2025 $50.00 Call options @ $3.35 per share.  Note: the Implied Volatility of the Calls was 35.1 when this position was established.  

A possible overall performance results (including commissions) if the position is in-the-money on the options expiration date is as follows:
Halozyme Covered Calls Net Investment: $19,578.68
= ($52.29 - $3.35) * 400 shares + $2.68 commission

Net Profit Components:
(a) Options Income: +$1,337.32
= ($3.35 * 400 shares) - $2.68 commission
(b) Dividend Income: +$0.00
(c) Capital Appreciation (If Halozyme stock is above the $50.00 strike price at the July 18th options expiration date): -$916.00
= ($50.00 strike price - $52.29 stock purchase price) * 400 shares

Potential Total Net Profit (If in-the-money and therefore assigned at expiration): +$421.32
= (+$1,337.32 options income + $0.00 dividend income - $916.00 capital appreciation)

Potential Absolute Return-on-Investment (If stock price is in-the-money and therefore assigned on the 7/18/2025 options expiration date): +2.2% = +$421.32/$19,578.68

Potential Equivalent Annualized-Return-on-Investment: +31.4%
= (+$421.32/$19,578.68) * (365/25 days)