Established Covered Calls in the D.R. Horton Inc.

This morning my Covered Calls net debit limit order was entered and immediately executed in D.R. Horton Inc. (ticker DHI) with a February 13th, 2026 options expiration date.  Two D.R. Horton Call options were sold at $7.67 at the $145.00 strike price when the stock price was $149.89 -- the net debit was $142.22 per share and the Call options time value profit potential was $2.60 [$7.67 options price - ($149.89 stock price - $145.00 strike price)].  The probability that the Calls will be in-the-money (i.e. above the $145.00 strike price) on the options expiration date was 67.0% when this position was established. There is an intervening ex-dividend of $.45 per share (1.2% annual dividend yield) on February 5th which is included in the potential return-on-investment results detailed below.

D.R. Horton is the largest homebuilder in America by market cap. Importantly, it is considered the best-in-class operator in its industry and has the highest exposure to the critically important entry-level buyers (67% of closings), lowest debt leverage, and least on-balance sheet land risk. 

As detailed below, two potential return-on-investment results are: (1) +2.0% absolute return-on-investment (equivalent to a +71.3% annualized return-on-investment in 10 days if the Calls are exercised and the stock is therefore assigned on the last business day prior to the February 5th ex-dividend date; and (2) +2.3% absolute return-on-investment (equivalent to a +46.1% annualized return-on-investment in 18 days if the DHI stock is in-the-money and the stock is assigned on its February 13th, 2026 options expiration date.

D.R. Horton Inc. (DHI) -- New Covered Calls Position
The Buy/Write transaction was as follows:
1/26/2026 Bought 200 shares of D.R. Horton Inc. stock @ $149.89 per share.  
1/26/2026 Sold 2 D.R. Horton February 13th, 2026 $145.00 Call options @ $7.67 per share.  The implied volatility of the Call options was 33.6 which, as preferred, is well above the current 16.1 of VIX.
2/5/2026 Upcoming ex-dividend of $.45 per share

Two possible overall performance results (including commissions) would be as follows:
Covered Calls Position Net Investment: $28,445.34
= ($149.89 - $7.67) * 200 shares + $1.34 commission

Net Profit Components:
(a) Options Income: +$1,534.00
= ($7.67 * 200 shares)
(b) Dividend Income (If option exercised early on Feb. 4th, the last business day prior to the February 5th ex-div date): +$0.00; or
(b) Dividend Income (If DHI stock assigned at the Feb. 13th, 2026 expiration): $90.00
= ($.45 dividend per share x 200 shares)
(c) Capital Appreciation (If D.R. Horton Call options assigned early on Feb. 5th): -$978.00
+($145.00 strike price - $149.89 stock price) * 200 shares; or
(c) Capital Appreciation (If shares assigned at $145.00 strike price at the Feb.13th options expiration): -$978.00
+($145.00 - $149.89) * 200 shares

1. Total Net Profit [If option exercised early on the last business day prior to the Feb. 5th ex-dividend date)]: +$556.00

= (+$1,534.00 options income +$0.00 dividend income -$978.00 capital appreciation); or

2. Total Net Profit (If stock shares assigned at $145.00 strike price at the Feb. 13th, 2026 expiration): +$646.00

= (+$1,534.00 options income +$90.00 dividend income -$978.00 capital appreciation)

1. Absolute Return-on-Investment (If option exercised early on Feb 5th): +2.0%

= +$556.00/$28,445.34

Annualized Return-on-Investment: +71.3%

= (+$556.00/$28,445.34) * (365/10 days); or

2. Absolute Return-on-Investment (If D.R. Horton shares assigned at $145.00 at the Feb. 13th, 2026 options expiration date): +2.3%

= +$646.00/$28,445.34

Annualized Return-on-Investment (If shares assigned at the 2/13/2026 options expiration date): +46.1%

= (+$646.00/$28,445.34) * (365/18 days)

At least eight of the nine metrics used in the Covered Calls Advisor's Dividend Capture Strategy spreadsheet must be 'YES' prior to establishing a position.  As shown below with this D.R. Horton Inc. position, eight of the nine criteria were met.