Johnson & Johnson Provides Upbeat Booster Shot Update

The security boasts reasonably priced options at the moment

Assistant Editor
Sep 21, 2021 at 10:28 AM
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The shares of Johnson & Johnson (NYSE:JNJ) are up 0.7% to trade at $164.90 at last check, after the company said a second shot of its Covid-19 vaccine administered about two months after the first dose increases effectiveness against moderate to severe disease to 94%. Plus, the pharmaceutical concern added the booster shot increases antibody levels four to six times.

On the charts, Johnson & Johnson stock yesterday fell to a three-month low of $162.16, with pressure coming from the once-supportive 150-day moving average, which coincides with a recent ceiling that has formed at the $166 level. Year-over-year, though, the security is still up 14%.

An unwinding of pessimism in the options could boost the shares. At the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), JNJ's 10-day put/call volume ratio stands higher than 80% of readings in the past year. This means puts have been getting picked up at a quicker-than-usual clip in the last two weeks.

At the moment, JNJ options are reasonably priced. This is per Johnson & Johnson stock's  Schaeffer's Volatility Index (SVI) of 19%, which ranks in the 30th percentile of its annual range, implying that options players are pricing in relatively low volatility expectations.


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