Chantix Disappointment Pressures Pfizer Stock

Analysts, though, are still bullish on the Dow component

Mar 23, 2018 at 10:17 AM
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Blue chip pharma name Pfizer Inc. (NYSE:PFE) is trading lower today following news the company's anti-smoking product, Chantix, didn't meet its goals in a late-stage study. The study was aimed at adolescent smokers aged 12 through 17. As such, PFE shares are down 0.7% at $35.35, sandwiched between their year-to-date breakeven mark of $36.22 and the all-important 200-day moving average, last seen near $35.16.

This price action is good news for a number of recent options traders, though. For instance, the April 38 put saw the largest increase in open interest during the past 10 days, thanks to big buy-to-open activity back on March 15. Elsewhere, traders have been selling to open overhead calls, including the April 37 and 38 strikes, as well as the May 37 call.

Peak open interest, meanwhile, resides at the June 37 call, which is home to 35,666 contracts -- most of which were, yes, sold to open. Overall, options activity has actually been muted on the equity, with total open interest sitting just three percentage points from a 12-month low.

Analysts have so far been silent following the Chantix news, but coming into today this group was very bullish on PFE. Eight of the 11 brokerage firms tracking the drugmaker had "buy" or "strong buy" ratings in place, and the average 12-month price target of $40.26 prices in upside of nearly 14% from current levels.


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