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Smith A.O. Corp (AOS) — wheel strategy suitability
Where AOS sits as an underlying for selling cash-secured puts and covered calls, and what its own price history says about the risk of being assigned into a falling stock. Snapshot of 3 October 2026.
Smith A.O. Corp (AOS) scores 70 on the Wheel score, which puts it in the acceptable band — it passes the profitability and options filters but is not among the strongest candidates.
The score is carried by its quality (76/100) and held back by valuation (51/100). Growth is deliberately excluded from this score: fast growers tend to carry high implied volatility and gap risk, which is the opposite of what a wheel seller wants. It is not cheap, so assignment would leave you holding a fully priced stock.
It has monthly options only, which costs it a small liquidity haircut. Workable, but every roll commits you for a month.
Over the last 3.0 years it had 0 days with a fall of 10% or more (0.0 a year), a deepest drawdown of -36.9%, and a worst single session of -9.4%. That is better than the median screened name (0.67 gap-downs a year, -44.9% typical worst drawdown).
Realised volatility runs about 26% annualised. That sits in the range where premium is worth collecting without the stock being wild.
There is no uptrend in the price right now, so assignment would leave you holding something that is not going up.
Score breakdown
| Wheel score | 70 | 0–100 suitability for options selling |
|---|---|---|
| Quality | 76 | ROIC, margins, leverage, accruals |
| Valuation | 51 | cheaper on fwd P/E, EV/EBITDA, FCF yield |
| Margin stability | — | steadier earnings score higher |
| Options listed | Monthly | weekly avoids the liquidity haircut |
| Accounting flags | 0 | −8 points each |
Realised tail risk
Computed from our own daily price history, 2023-10-04 to 2026-10-01 (749 sessions). The Wheel score is built from fundamentals, so these price-derived numbers are an independent check on it, not a restatement of it.
| Days falling 10%+ in one session | 0 | 0.0 a year |
|---|---|---|
| Deepest drawdown | -36.9% | peak to trough |
| Worst single session | -9.4% | |
| Realised volatility | 26% | annualised |
Fundamentals
| Revenue (ttm) | 3,830M USD |
|---|---|
| Revenue CAGR (3y) | 0.7% |
| Net margin | 14.3% |
| Return on equity | 29.4% |
| Share price | $56.67 |
| Days to earnings | — |
| Sector / industry | Industrials · Specialty Industrial Machinery |
Open the AOS options chain on Yahoo Finance to check live strikes and premium — this page deliberately carries no quotes, because a quote baked into a static page is stale before you read it.
Run the numbers on AOS
Pre-filled with the snapshot price of $56.67 and 30-day realised volatility; add the strike and premium from the live option chain.