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
facebook twitter linkedin

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.

Sign up now for Schaeffer's Market Recap to get all the day's big stock movers, must-know technical levels, and top economic stories straight to your inbox.

Now is the time to join our thriving community of Event Traders who consistently profit from every earnings season. With this discounted subscription opportunity, you'll stay ahead of the curve and seize opportunities others miss. Do not let Q3 earnings season pass you by – subscribe now and supercharge your portfolio with expert insights that turn market reactions into profit-generating opportunities!! Don't waste another second... join us right now before the next trade targeting +200% is released!