Penny Stock Surges on Cannabis News

NEPT stock was already up almost 400% in the past 12 months

Sep 17, 2018 at 10:01 AM
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The shares of Neptune Technologies & Bioressources Inc (NASDAQ:NEPT) are hot this morning, following news the wellness solutions specialist is set to receive a license to produce medical cannabis in Canada. The company also said it's planning to complete the second part of its expansion project in the first quarter of next year, which will significantly increase its processing capabilities.

This news follows Neptune's announcement back in June of a multi-year agreement with Canopy Growth (CGC) to make extracted cannabis products. So far today, NEPT stock has gained 20.7% to trade at $4.61.

Looking back, the equity traded as high as $4.75 early this month, and then found support from the 20-day moving average. On a longer-term basis the security had already been outperforming, rising nearly 400% year-over-year.

It would seem some options traders were already betting on a breakout from Neptune shares. Data from the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) shows roughly 3,800 calls bought to open during the past 10 days, compared to just 59 puts. The most popular call, based on open interest added, was the February 8 call, where data confirms buy-to-open activity has taken place -- suggesting speculators see much more upside in the months ahead.

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