Karyopharm Therapeutics Shorts Sidelined as Drug Stock Soars

KPTI is short-sale restricted following Monday's plunge

Managing Editor
May 1, 2018 at 10:42 AM
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Karyopharm Therapeutics Inc (NASDAQ:KPTI) is up 16% to trade at $15.19, after the company last night reported upbeat data from its mid-stage study for Selinexor, a cell-cancer treatment. In response, Wedbush raised its price target to $21 from $19, while RBC issued a price-target hike to $24 from $22 -- both in territory the equity has not traded near since mid-2015.

While Karyopharm stock remains well off their March 12 two-year high of $18, it's on track for its best single-day session since March 2017. Plus, the stock's 120-day moving average emerged as a trusty floor in April, and the shares are still boasting a more than 79% nine-month gain.

Amid today's volatile trading, options volume has exploded -- though absolute volume is relatively light. Nevertheless, calls are trading at 10 times the average intraday pace, and puts crossing at six times what's typically seen at this point in the day.

Although the stock is currently short-sale restricted following Monday's 13.7% drop , a short squeeze could provide more tailwinds for KPTI. Short interest increased by almost 24% in the two most recent reporting periods to 2.58 million shares, the highest amount since mid-August. This represents a healthy 8% of KPTI's total available float, and nearly four days of pent-up buying demand, at the average pace of trading. 

 

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