Bloom Energy draws outsized options volume as energy rally stalls

Bloom Energy is seeing heavy options activity even as energy stocks in the S&P 500 push toward new 52-week highs. Shares have surged on the back of momentum, but options traders are positioning for a wider range of outcomes.

Options volume outpaces major energy names

Bloom Energy’s options trading has climbed to more than 2.5 times the 30-day average, with premium exchange totaling almost half a billion dollars by midday, according to Cboe LiveVol and SpotGamma. That compares with about $350 million traded in SpaceX options and $25 million in Valero Energy options, the most volatile S&P 500 energy stock.

Bloom shares rose more than 10% Tuesday. The stock is up more than 30% over the past week and nearly 70% since earnings reported in late July. Over three years, Bloom is up 1,800%.

Implied volatility signals bigger swings than peers

Bloom’s implied volatility is over 90%, per ThinkOrSwim, higher than any other energy stock in the S&P 500 group cited. Valero has the highest volatility among the rest at 50%, while ExxonMobil is at 30%.

The most active Bloom contract by volume on Tuesday was the 300-strike call expiring Friday, trading at $4.65. That contract requires the stock to gain about 8% to break even.

S&P 500 inclusion date set for Sept. 21

S&P Dow Jones Indices said Bloom Energy will join the S&P 500 on Sept. 21. The change will be the first time an energy stock has been added to the index since 2022, according to UBS analyst Manav Gupta.

ETF flows show mixed positioning

Options activity around the U.S. Oil Fund (USO) and the State Street Energy Select Sector SPDR ETF (XLE) was mixed. USO volume was 50% above the 30-day average, around $90 million, with roughly the same number of put contracts as calls. The three most popular contracts by volume were puts, based on SpotGamma data.

In XLE, 48,000 calls were likely bought versus 34,000 puts. Total premium was $37 million, with $31 million tied to calls. Among the top five contracts traded in XLE, three were puts.

Why it matters

Bloom’s options market is pricing far more volatility than other S&P 500 energy names, even as conventional energy strength continues. The combination of S&P 500 inclusion timing and elevated implied volatility is drawing attention to how investors expect the next move in the stock.