At 2:03pm ET this afternoon, I established a Covered Call position in HCA Healthcare Inc. (ticker HCA) when my buy/write net debit limit order was executed at a price of $319.82. One hundred shares were purchased at $333.62 and 1 August 15th, 2025 $325.00 Call option was sold at $13.80 per share. So, the maximum potential time value profit if the stock is in-the-money and therefore closed out by assignment on the options expiration date is $5.18 per share [$13.80 Call option premium - ($333.62 stock purchase price - $325.00 strike price)]. The probability that the Call option will be above the $325.00 strike price on the August 15th options expiration date when this Covered Call position was established today was 65.4%.
HCA is the largest acute care hospital company in the U.S., with 190 hospitals and 124 freestanding surgery centers as of the end of 2024. They also have a broad network of physician offices, urgent-care clinics, and freestanding emergency rooms across 20 states and with a small presence in England. HCA just delivered a strong Q2 2025, with robust earnings and revenue growth accompanied by margin expansion, both of which exceeded last year's comparable results as well as analysts' expectations; plus, they are continuing with their quarterly stock buyback program. I am also pleased that HCA's quarterly GAAP results are normally very consistent with and most often identical to their non-GAAP results. So, I think today's substantial sell-off is overdone and is not indicative of HCA's current strength and ongoing operational momentum. Management also boosted FY2025 guidance.
As detailed below, a potential return-on-investment result is +1.6% absolute return-on-investment (equivalent to +28.1% annualized
return-on-investment for the next 21 days) if HCA's share price is in-the-money (i.e. above the $325.00 strike price) and the stock is therefore assigned on its August 15th, 2025 options expiration date.
HCA Healthcare Inc. (HCA) -- New Covered Call Position
The net debit buy/write limit order was executed as follows:
7/25/2025 Bought 100 shares of HCA Healthcare Inc. stock @ $333.62 per share.
7/25/2025 Sold 1 HCA August 15th, 2025 $325.00 Call option @ $13.80 per share.
Note: this was a simultaneous Buy/Write transaction and the Implied Volatility of the Call at 27.2 was well above a VIX of 15.1 when this position was established.
A possible overall performance result (including commissions) if this position is assigned on its 8/15/2025 options expiration date is as follows:
HCA Covered Call Net Investment: $31,982.67
= ($333.62 - $13.80) * 100 shares + $.67 commission
Net Profit Components:
(a) Option Income: +$1,379.33
= ($13.80 * 100 shares) - $.67 commission
(b) Dividend Income: +$0.00
(c) Capital Appreciation (If HCA Healthcare stock is above the $325.00 strike price at the August 15th, 2025 options expiration date): -$862.00
= ($325.00 strike price - $333.62 stock purchase price) * 100 shares
Total Net Profit Potential (If HCA stock is in-the-money and therefore assigned at the $325.00 strike price on its 8/15/2025 options expiration date): +$517.33
= (+$1,379.33 option income + $0.00 dividend income - $862.00 capital appreciation)
Potential Absolute Return-on-Investment: +1.6%
= +$517.33/$31,982.67
Potential Equivalent Annualized-Return-on-Investment: +28.1%
= (+$517.33/$31,982.67) * (365/21 days)
