Moderna Stock Upgrade Has Call Traders Moving In

Call volume is already running at double the intraday average

Digital Content Manager
Jun 26, 2023 at 10:19 AM
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UBS upgraded Moderna Inc (NASDAQ:MRNA) to "buy" from "neutral" this morning, but also lowered its price targe to $191 from $221. The firm noted potential upside from its next generation of mRNA vaccines, including Respiratory Syncytial Virus (RSV) and flu shots, present "a major opportunity" but are not yet priced into MRNA's valuation.

Last seen up 1.1% at $119.81, the stock is bouncing off its lowest trading level since October. The descending 60-day moving average has rejected three of the shares' rallies since late January, and contributed to a steep 32.5% year-to-date deficit.

In the options pits, already 6,489 calls have crossed the tape -- compared to 1,459 puts -- volume that is double the intraday average. Most popular is the weekly 6/30 122-strike call, where new positions are being bought to open.

This penchant for bullish bets is unusual, per MRNA's 10-day put/call volume ratio of 1.89 over at the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX). This ratio sits one percentage point from an annual high, indicating the rate of put buying has been quite elevated in the last two weeks.

MRNA boasts affordably priced premiums, per its Schaeffer's Volatility Index (SVI) of 40% that sits at the extremely low 2nd percentile of annual readings. In other words, now looks like an excellent opportunity to bet on Moderna stock's next move with options. 
 

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