MDXG is up 130% over the last 12 months
It's been a huge year for regenerative tissue specialist
MiMedx Group Inc (NASDAQ:MDXG), with the shares soaring close to 130% year-over-year to trade at $16.94, while hitting a record high of $17.24 just yesterday. Meanwhile, options volume has been accelerated, evidenced by the fact that total open interest now stands at a 52-week high. It's more of the same today, too, as options traders are betting on an extended breakout for MDXG stock.
Jumping right in, calls are trading at double the pace expected today, and leading the way is the March 2018 20-strike call. All signs point to buy-to-open activity here, which would mean speculators are betting on MiMedx shares toppling the $20 level by the time the contracts expire in March.
Interestingly, puts have also been very popular on MDXG. The top open interest position belongs to the September 12.50 put, and data from the major options exchanges confirms buy-to-open activity here. Furthermore, the equity has a Schaeffer's put/call open interest ratio (SOIR) of 2.37, ranking just 1 percentage point from a 12-month high, so short-term options traders are unusually put-skewed at the moment. But given the stock's tremendous technical strength, much of this is likely due to shareholders
hedging with options.
Still, MiMedx could have even more upside potential, from a contrarian standpoint. First of all, short interest remains very elevated, despite a sharp drop earlier in the year. In fact, short interest actually increased over the two most recent reporting periods, and now represents over one-fifth of the stock's float. Meanwhile, the shares are now trading comfortably above their average 12-month price target of $15. As such, a short-squeeze situation and/or a round of analyst price-target hikes could provide tailwinds for MDXG.