The Drug Stock Crushing Short Sellers; Goldman Calls FedEx a 'Buy'

A short squeeze could push Nektar Therapeutics stock even higher

Managing Editor
Nov 13, 2017 at 10:11 AM
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Analysts are weighing in on global delivery service FedEx Corporation (NYSE:FDX), digital credit provider Qudian Inc (NYSE:QD), and drug stock Nektar Therapeutics (NASDAQ:NKTR). Here's a quick roundup of today's bullish brokerage notes on shares of FDX, QD, and NKTR.

Goldman Starts FedEx Stock With a "Buy" Rating

FedEx stock is up 0.5% to trade at $219.17, after Goldman Sachs initiated coverage on the delivery company with a "buy" rating and set its price target at $270 -- a roughly 23% premium to current trading levels. Analysts at Goldman believe any concerns over Amazon's delivery service are overblown, and said the market is not pricing in global trade acceleration.

Today's upside is just more of the same for FDX stock, which has tacked on almost 18% year-to-date and touched an all-time high of $231.35 on Oct. 27. The shares' upswing has been supported by the 80-day moving average, which has served as a springboard since September.

This positive price action should be well received by options traders, who've been unusually focused on long calls over puts in recent weeks. This is according to FedEx's 10-day call/put volume ratio of 1.40 at the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), which ranks in the 89th percentile of its annual range.

Qudian's Earnings Beat Prompts Bullish Analyst Attention 

Qudian stock is up 1.1% to trade at $27.20, after the Chinese online lender delivered a third-quarter earnings beat. As a result, Credit Suisse started Qudian off with an "outperform" rating and a price target of $33. The stock has added 13% since pricing its initial public offering (IPO) of $24 per share on Oct. 18, the fourth-largest U.S. IPO this year.

Nektar Therapeutics Boasts Impressive Cancer Drug Data 

Nektar Therapeutics stock is up 22.3% to trade at $39.75, earlier hitting a 16-year high of $41.34, after the company reported upbeat results for its NKTR-214, its lung cancer drug, when used in combination with Bristol-Myers Squibb's Opdivo. The news resulted in no fewer than three price-target hikes, including one to $50 from $35 at Canaccord Genuity -- which said the treatment could generate peak sales of $3.84 billion.

NKTR stock has now tacked on an impressive 224% year-to-date, and a short squeeze could further extend Nektar's upside. While short interest turned lower in the last two reporting periods, the 12.56 million shares still sold short represent a healthy 8% of NKTR's total available float. It would take over 11 days for shorts to fully cover their positions, at the equity's average trading volume.


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