Eli Lilly COVID-19 Vaccine Trials on Pause After FDA Order

The company joined Johnson & Johnson as the latest drug maker to have its trial paused

Deputy Editor
Oct 14, 2020 at 10:43 AM
facebook X logo linkedin

The shares of Eli Lilly And Co (NYSE:LLY) are up 0.1%, last seen trading at $150.22 this morning, even after the company joined Johnson & Johnson (JNJ) on the list of pharmaceutical companies forced to pause one of their COVID-19 vaccine trial paused. According to a Reuters report, the U.S. Food and Drug Administration (FDA) halted Eli Lilly's antibody treatment, ACTIV-3, after it uncovered some serious quality control problems at the company's manufacturing plant, hindering the Lilly's bid to get emergency use authorization for the treatment. The company will continue its other ongoing coronavirus trials, though these could be less beneficial for patients with serious cases. 

Taking a look at the charts, it's surprising to see that just three months ago LLY hit an all-time high of $170.75. It's fallen off just over 9% in that time, and is once again facing pressure from its 50-day moving average after spending three of the last five sessions above the trendline. Still, longer term, Eli Lilly sports a 36.5% year-over-year lead.

Despite today's news, analysts are still rather optimistic toward the equity. In fact, eight of the 11 brokerages in coverage sport a "strong buy," while the remaining three call recommend a tepid "hold." Plus, the 12-month consensus price target of $165.07 is a 10% premium to current levels. 

Echoing this is the response from short sellers, who are hitting the exits in droves. Short interest down nearly 40% in the last reporting period. The 3.77 million shares sold short make up less than 1% of the stock's available float, and would take just over a day to cover, at its average daily pace of trading. 

Options traders are responding in kind to today's news. Over 5,000 calls have changed hands already, double the average intraday amount and triple the number of puts traded. Leading the charge so far is the weekly 10/23 160-strike call, where new positions are being opened. Buyers of these calls are banking on a sizable pop from LLY in the coming weeks, when the contracts expire.


Target Effortless Triple-Digit Gains Every Sunday Evening For Life!

This is your chance to triple your profit potential on Sunday evenings, without spending all your free time watching the market.

On Sundays, as a Weekend Plus subscriber, you’ll get up to 6 trades every Sunday, each targeting gains of 200% or more.

Start targeting gains like the ones our subscribers have seen recently, including:

213.3% GAIN on AutoNation calls
100.0% GAIN on Monster Beverage calls
100.4% GAIN on Walgreens Boots Alliance puts
100.4% GAIN on ON Semiconductor calls
257.7% GAIN on Dell calls

101.0% GAIN on Apollo Global Management calls
103.6% GAIN on JP Morgan  Chase calls
105.3% GAIN on DraftKings calls
101.3% GAIN on Airbnb calls
203.0% GAIN on Shopify calls
102.0% GAIN on Cboe Global Markets calls
100.9% GAIN on Boeing calls
102.1% GAIN on Microsoft puts
102.3% GAIN on First Solar calls
101.5% GAIN on PulteGroup calls
101.0% GAIN on Apple calls
209.4% GAIN on NXP Semiconductors calls
100.8% GAIN on Uber Technologies calls
100.4% GAIN on Academy Sports and Outdoors puts
102.2% GAIN on Trade Desk calls
100.8% GAIN on DoorDash calls
100.0% GAIN on Camping World Holdings puts
100.0% GAIN on Cboe Global Markets calls
100.2% GAIN on C3.ai calls
238.5% GAIN on Oracle calls



Rainmaker Ads CGI