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Biotech Stock Reverses Gains Despite Obesity Pill Buzz

Options bulls are leading today's charge

Digital Content Manager
Nov 4, 2024 at 10:42 AM
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Viking Therapeutics Inc (NASDAQ:VKTX) stock is up 4.3% to trade at $74.13 at last glance, reversing course from earlier gains. The company earlier said its experimental obesity pill showed weight loss of up 8.2% over a four-week period. The strong results could help Viking Therapeutics compete with Eli Lilly (LLY) and Novo Nordisk (NVO).
 

VKTX's earlier bounce off the $70 level came short of a familiar ceiling at $80, but the 20-day moving average lingers below as support. Shares sport a jaw-dropping 571.8% year-over-year lead, with 282.2% added just in 2024.

Options volume is running at seven times the intraday average volume so far today, with 35,000 calls and 10,000 puts traded so far. The most active contract by far is the weekly 11/8 80-strike call, where new positions are being opened.
 

While calls outpace puts in the options pits, there's plenty of pessimism to unwind. This is per VKTX's 10-day put/call volume ratio over at the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), which sits higher than 80% of annual readings. Plus, short interest still makes up 13.8% of the security's available float.

 

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