Medicines Company Stock Hits Two-Year High on Drug Data

At least three analysts have already issued price-target hikes

Deputy Editor
Sep 3, 2019 at 10:07 AM
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The Medicines Company (NASDAQ:MDCO) stock is seeing a huge boost today, after the biopharmaceutical firm announced its experimental drug inclisiran successfully lowered cholesterol in patients with heart disease enrolled in a late-stage trial. SVB Leerink sees the drug's bi-annual injection form as more convenient than treatments from competitors Amgen (AMGN) and Regeneron Pharmaceuticals (REGN). MDCO stock is fresh off a new $47.50, last seen trading up 7.2% at $45. 

Several other analysts are chiming in, too. Cowen, Citigroup, and Oppenheimer lifted their target prices to $50, $55, and $60, respectively, and Bernstein called the study's safety profile reassuring. All nine brokerages in coverage already call MDCO a "strong buy," and the stock's consensus 12-month target price of $60.79 is a 35% premium to current levels.

This bullish sentiment shouldn't come as a surprise, though, given the stock's strong technical performance this year. While the equity briefly dipped lower in mid-August, a big bounce off its 120-day moving average helped the shares clock a 17% monthly gain -- their biggest since January. Plus, MDCO just toppled the $43.50 region, which contained last week's upside.

Things have been optimistic in the options pits, too, with over three calls purchased for every put on the the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) during the last 10 days. The resultant 3.29 call/put volume ratio sits in the 74th percentile of its annual range, suggesting a bigger-than-usual appetite for bullish bets over bearish of late.


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