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Options Traders Blast Record-Setting Corbus Pharmaceuticals Holdings Inc (CRBP)

Corbus Pharmaceuticals Holdings Inc (NASDAQ:CRBP) hit a new all-time peak, thanks to a pair of upbeat analyst notes

Oct 5, 2016 at 12:26 PM
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Corbus Pharmaceuticals Holdings Inc (NASDAQ:CRBP) is trading up 28.3% at $9.01 -- the top performer on the Nasdaq -- and fresh off a record high of $9.59, following upbeat "buy" initiations at Cantor and SunTrust Robinson. What's more, the former set its price target at $17 and the latter at $22, more than double CRBP stock's present price. And while options volume is accelerated on the inflammatory fibrotic disease specialist, it's bearish short sellers who are likely feeling the pain.

Taking a quick step back, volume is running at six times the average intraday pace in CRBP's lightly traded options pits -- although numbers are still low on an absolute basis. Amid this uptick in volume, the stock's 30-day at-the-money implied volatility has jumped 16.5% to an annual high of 199.5%.

More broadly speaking, calls have been preferred over puts in CRBP's options pits. Although both call and put open interest are docked at 12-month highs, calls outpace puts by a nearly 7-to-1 margin across all series.

Drilling down, the stock's November 10 call is home peak open interest of 4,956 contracts, and according to the major options exchanges, there's been a near-even mix of buy- and sell-to-open activity here in recent months. Those purchasing the calls expect CRBP to rally north of $10 by back-month options expiration at the close on Friday, Nov. 18, while those writing the calls see this round-number strike serving as a near-term ceiling for the shares.

Outside of the options arena, short sellers have been quick to raise the bearish stakes, with short interest up more than 250% in the most recent reporting period. Although these bearish bets still only account for a low 2.3% of CRBP's available float, this fresh batch of skeptical traders could be getting burned today.

Technically, Corbus Pharmaceuticals Holdings Inc (NASDAQ:CRBP) had already put in a monster showing on the charts heading into the session -- nearly quadrupling in value year-over-year at Tuesday's close. However, today's trading has put the shares comfortably north of the $7.90 region, home to CRBP's previous highs from late September.

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