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ISIS Pharmaceuticals, Inc. calls are flying off the shelves today
ISIS Pharmaceuticals, Inc. (NASDAQ:ISIS) is in rally mode today -- up 8.8% at $64.79, and earlier topping out at a record peak of $67.12 -- following bullish comments made by CNBC's Jim Cramer. Against this backdrop, calls are trading at eight times the average intraday clip, and per the equity's 30-day at-the-money implied volatility, which is up 6.5% to 59%, short-term contracts are in high demand.
In the soon-to-be front-month series, traders are targeting the January 2015 65- and 70-strike calls. Drilling down, there appears to be some buy-to-open activity here, as traders roll the dice on a bigger run into uncharted territory over the next four weeks.
From a wider sentiment perspective, options traders have shown a growing affinity for puts over calls among options slated to expire in three months or less. In fact, since Nov. 21 -- when November options expired -- the stock's Schaeffer's put/call open interest ratio (SOIR) has edged up to 0.88 from 0.82. What's more, the current ratio ranks in the 64th annual percentile, meaning short-term speculators are more put-heavy than usual toward the shares.
Thanks to today's surge, ISIS Pharmaceuticals, Inc. (NASDAQ:ISIS) is now boasting an impressive 63% year-to-date lead. An extended run into uncharted territory could prompt another round of upbeat analyst attention. At present, one-third of those covering the shares maintain a "hold" or "sell" suggestion, while the consensus 12-month price target of $55.90 stands at a discount to current trading levels.