BZH Covered Call Strategy
BZH (Beazer Homes USA, Inc.), in the Consumer Cyclical sector, (Residential Construction industry), listed on NYSE.
Beazer Homes USA, Inc. operates as a homebuilder in the United States. It designs, constructs, and sells single-family and multi-family homes under the Beazer Homes, Gatherings, and Choice Plans names. The company sells its homes through commissioned new home sales counselors and independent brokers in Arizona, California, Nevada, Texas, Delaware, Maryland, Indiana, Tennessee, Virginia, Florida, Georgia, North Carolina, and South Carolina. Beazer Homes USA, Inc. was founded in 1985 and is headquartered in Atlanta, Georgia.
BZH (Beazer Homes USA, Inc.) trades in the Consumer Cyclical sector, specifically Residential Construction, with a market capitalization of approximately $645.6M, a beta of 2.15 versus the broader market, a 52-week range of 17.83-28.33, average daily share volume of 513K, a public-listing history dating back to 1994, approximately 1K full-time employees. These structural characteristics shape how BZH stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 2.15 indicates BZH has historically moved more than the broader market, amplifying both the directional payoff and the realized volatility relative to an index-equivalent position.
What is a covered call on BZH?
A covered call pairs long stock with a short out-of-the-money call, collecting premium and capping upside above the short strike in exchange for income.
Current BZH snapshot
As of May 15, 2026, spot at $22.17, ATM IV 47.30%, IV rank 27.14%, expected move 13.56%. The covered call on BZH below is built from the same end-of-day chain, with strikes snapped to listed contracts and premiums pulled from the bid/ask midpoint at a 34-day expiry.
Why this covered call structure on BZH specifically: BZH IV at 47.30% is on the cheap side of its 1-year range, which means a premium-selling BZH covered call collects less credit per unit of strike-width risk, with a market-implied 1-standard-deviation move of approximately 13.56% (roughly $3.01 on the underlying). The 34-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated BZH expiries trade a higher absolute premium for lower per-day decay. Position sizing on BZH should anchor to the underlying notional of $22.17 per share and to the trader's directional view on BZH stock.
BZH covered call setup
The BZH covered call below is built from the end-of-day chain, with each option leg priced at the bid/ask midpoint of its listed strike. With BZH near $22.17, the first option leg uses a $23.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed BZH chain at a 34-day expiry; the cross-strike IV skew is reflected directly in the per-leg values rather than approximated. Quantity sizing assumes one contract per option leg (or 100 BZH shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 100 shares | Stock | $22.17 | long |
| Sell 1 | Call | $23.00 | $0.88 |
BZH covered call risk and reward
- Net Premium / Debit
- -$2,129.50
- Max Profit (per contract)
- $170.50
- Max Loss (per contract)
- -$2,128.50
- Breakeven(s)
- $21.30
- Risk / Reward Ratio
- 0.080
Max profit equals short-strike minus cost basis plus premium times 100; max loss is cost basis minus premium (at zero). Breakeven is cost basis minus premium.
BZH covered call payoff curve
Modeled P&L at expiration across a range of underlying prices for the covered call on BZH. Each row is one sampled price point from the computed payoff curve; the full curve uses 200 price points internally before being summarized into 10 rows here.
| Underlying Price | % From Spot | P&L at Expiration |
|---|---|---|
| $0.01 | -100.0% | -$2,128.50 |
| $4.91 | -77.8% | -$1,638.42 |
| $9.81 | -55.7% | -$1,148.34 |
| $14.71 | -33.6% | -$658.26 |
| $19.61 | -11.5% | -$168.18 |
| $24.51 | +10.6% | +$170.50 |
| $29.41 | +32.7% | +$170.50 |
| $34.32 | +54.8% | +$170.50 |
| $39.22 | +76.9% | +$170.50 |
| $44.12 | +99.0% | +$170.50 |
When traders use covered call on BZH
Covered calls on BZH are an income strategy run on existing BZH stock positions; traders typically sell calls at 25-35 delta with 30-45 days to expiration to balance premium against upside cap.
BZH thesis for this covered call
The market-implied 1-standard-deviation range for BZH extends from approximately $19.16 on the downside to $25.18 on the upside. A BZH covered call collects premium on an existing long BZH position, trading off upside above the short call strike for immediate income; the short strike selection should reflect the trader's view on whether BZH will breach that level within the expiration window. Current BZH IV rank near 27.14% sits in the lower third of its 1-year distribution, where IV often re-expands toward the mean; this favors premium-buying structures and disadvantages premium-selling structures on BZH at 47.30%. As a Consumer Cyclical name, BZH options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to BZH-specific events.
BZH covered call positions are structurally neutral to slightly bullish; the modeled P&L assumes European-style exercise at expiration and ignores early assignment, transaction costs, dividends paid before expiry on the stock leg (when present), and the bid-ask spread on the listed chain. BZH positions also carry Consumer Cyclical sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move BZH alongside the broader basket even when BZH-specific fundamentals are unchanged. Short-premium structures like a covered call on BZH carry tail risk when realized volatility exceeds the implied move; review historical BZH earnings reactions and macro stress periods before sizing. Always rebuild the position from current BZH chain quotes before placing a trade.
Frequently asked questions
- What is a covered call on BZH?
- A covered call on BZH is the covered call strategy applied to BZH (stock). The strategy is structurally neutral to slightly bullish: A covered call pairs long stock with a short out-of-the-money call, collecting premium and capping upside above the short strike in exchange for income. With BZH stock trading near $22.17, the strikes shown on this page are snapped to the nearest listed BZH chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are BZH covered call max profit and max loss calculated?
- Max profit equals short-strike minus cost basis plus premium times 100; max loss is cost basis minus premium (at zero). Breakeven is cost basis minus premium. For the BZH covered call priced from the end-of-day chain at a 30-day expiry (ATM IV 47.30%), the computed maximum profit is $170.50 per contract and the computed maximum loss is -$2,128.50 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a BZH covered call?
- The breakeven for the BZH covered call priced on this page is roughly $21.30 at expiration, derived from end-of-day chain premiums. Breakeven is the underlying price at which the strategy's P&L crosses zero ignoring transaction costs and assignment risk. The current BZH market-implied 1-standard-deviation expected move is approximately 13.56%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a covered call on BZH?
- Covered calls on BZH are an income strategy run on existing BZH stock positions; traders typically sell calls at 25-35 delta with 30-45 days to expiration to balance premium against upside cap.
- How does current BZH implied volatility affect this covered call?
- BZH ATM IV is at 47.30% with IV rank near 27.14%, which is on the low end of its 1-year range. Premium-buying structures (long call, long put, debit spreads) are relatively cheap in this regime; premium-selling structures collect less credit per unit risk.