Option Focus | USA Rare Earth IV Prices in a 14% Earnings Swing; Traders Sell Calls to Harvest Premium While Buy June $30 Calls for Upside Exposure

USA Rare Earth is scheduled to report quarterly results after the U.S. market close on May 13, 2026. Investors are closely watching progress in the company’s rare earth operations and whether profitability metrics continue to improve. As of the latest trading session on May 12, 2026, the stock closed at $26.30.

Consensus estimates project quarterly revenue of $4.23 million, while adjusted loss per share is expected at $0.137, widening 142.27% from a year earlier.

Options Market Signals Ahead of Earnings

1. Implied Volatility Signals Elevated Earnings Expectations

Based on options expiring on May 15, 2026 — the first expiration date following earnings — aggregate implied volatility (IV) stands at 152.65%, placing it in the 97.21st historical percentile, an exceptionally elevated level that points to expectations for sharp post-earnings price swings.

• Expected move: Options pricing implies a 68% probability that USAR shares move within ±13.84% this week.

• Implied trading range: Based on the current share price of $26.30, the market is pricing in a core range of roughly $22.66 to $29.94.

The elevated IV and percentile ranking suggest investors are aggressively pricing in earnings uncertainty and the potential for outsized two-way volatility. Meanwhile, the IV-to-historical volatility ratio of 1.46 indicates implied volatility is running well above the stock’s recent realized volatility, creating a rich premium environment for event-driven options traders.

Diverging Institutional Flows Emerge

2. Block Trade Activity Highlights Split Positioning

Over the past three trading sessions, institutional positioning has reflected a split strategy centered on “short-term volatility harvesting versus medium-term upside participation.”

Overall flow skewed bullish, with the call-to-put ratio reaching 1.97. Two large trades stood out in particular:

• Near-dated premium harvesting strategy: One institution established a multi-leg position by selling 2,418 May 15 $30 call contracts while simultaneously buying 1,209 May 15 $35 calls as a partial hedge.

  The structure generated roughly $151,100 in net premium income. The core thesis behind the trade is that, despite elevated volatility expectations, USAR shares are unlikely to rally materially above $30 before the May 15 expiration.

  $USAR Vertical 260515 30.0C/35.0C$

• Bullish June positioning: Separately, another participant purchased 2,853 June 18 $30 call contracts in a transaction valued at approximately $679,000.

  The trade represents a clear directional bullish wager that the stock could break above $30 and establish further upside momentum between earnings and mid-June.

  $USAR 20260618 30.0 CALL$

Strategy Takeaways

3. Elevated IV Creates Opportunities for Both Buyers and Sellers

The options market is exhibiting classic event-driven characteristics ahead of earnings: exceptionally high implied volatility is creating opportunities for premium sellers, while the earnings catalyst is also attracting directional upside speculation.

For investors with different risk tolerances, the positioning suggests distinct approaches:

• Premium-selling strategies: With IV near historical extremes, selling out-of-the-money calls above the $30 strike is being viewed by some traders as a relatively favorable risk-reward setup, as reflected in the large call spread trade. Investors seeking to avoid unlimited upside risk may consider a covered call spread structure similar to the institutional positioning — selling near-dated out-of-the-money calls while purchasing higher-strike calls to cap potential losses.

• Bullish directional strategies: Buying near-term at-the-money options carries substantial theta decay risk under current volatility conditions. More aggressive bulls may prefer longer-dated contracts, similar to the June positioning highlighted above, allowing additional time for a directional move to develop while reducing exposure to the post-earnings implied volatility collapse commonly seen in front-month options.

Overall, the options market suggests traders are simultaneously monetizing elevated near-term volatility premiums while maintaining upside exposure through longer-dated contracts. The positioning reflects caution toward USAR’s immediate post-earnings reaction, but also signals a degree of optimism around the company’s medium- to longer-term outlook.