The Biotech That's More Than Doubled Today

Meanwhile, Tronox shares are falling fast

Josh Selway
Dec 6, 2017 at 1:59 PM
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U.S. stocks are slightly higher this afternoon, as investors react to this morning's jobs data. Among the names making big moves are chemical stock Tronox Ltd (NYSE:TROX), as well as biotechs Madrigal Pharmaceuticals Inc (NASDAQ:MDGL) and Vistagen Therapeutics Inc (NASDAQ:VTGN). Here's a quick look at what's moving shares of TROX, MDGL, and VTGN.

Tronox Stock Short-Sale Restricted

Tronox stock is tanking today, last seen 25.7% lower at $18.95, after U.S. regulators filed a lawsuit to challenge the company's purchase of Cristal's titanium dioxide business. Tronox responded by saying it will "vigorously fight" the lawsuit. The shares' pullback has them testing their 200-day moving average for the first time since June, when the trendline served as strong report. Even with the massive losses today, which have TROX on the short-sale restricted list, the security has a year-to-date lead of roughly 85%.

This all could be bad news for options traders, who've remained committed to calls in recent weeks. Specifically, Tronox has a 10-day call/put volume ratio of 2.22 at the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), showing call buying has more than doubled put buying.

Madrigal Takes Off On Drug-Study Results

Madrigal stock has exploded 77% to trade at $82.01, earlier hitting a two-year high of $101, thanks to news its liver disease drug met its main goal in a mid-stage study. Traders who've held the shares over the past year have made a killing, with MDGL up more than 400% year-over-year. H.C. Wainwright sees more upside, too, boosting its price target to $105 from $54.

On the flip side, short interest is at a record high, with almost 6% of the security's float sold short. Going by average daily volumes, it'd take these bears four days to cover their positions.

VTGN Stock More Than Doubles On Patent News

Vistagen Therapeutics is also making a huge move today, last seen up 151% at $2.31, after the company received a patent for its oral antidepressant treatment, which already has a European patent. This price action ends a steady year-long downtrend for VTGN stock, and has the shares atop their 200-day moving average for the first time since early 2016. We'll see if this is enough to attract the attention of analysts, since at the moment not a single brokerage firm has issued coverage on the biotech.


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