Kite Pharma, Inc. (KITE) Call Buying Ramps Up

Kite Pharma Inc's (KITE) is up nearly 8% today, and option traders expect more upside

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Published on Feb 23, 2015 at 12:20 PM
Updated on Apr 20, 2015 at 5:32 PM

Option volume has picked up on Kite Pharma Inc (NASDAQ:KITE). Call volume is three times what's normally seen at this point in the day, outpacing puts by a more than 2-to-1 margin. Option traders have taken an interest in the March 75 call, where buy-to-open activity appears to be taking place. These speculators are betting on KITE to make the roughly 11% jump north of $75 by the close on Friday, March 20, when the contracts expire.

At last check, the shares were 7.9% higher at $67.74, and the firm this morning said CEO Arie Belldegrun, M.D., will present at a Cowen and Company healthcare conference next Monday. KITE has seen its fair share of volatility in 2015. The stock is off over 24% since hitting an all-time high of $89.21 on Jan. 15, but is on pace to end atop its 10-day and 20-day moving averages for the first time in over a month.

Even so, option traders have increasingly preferred KITE calls over puts. For example, at the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), speculators have bought to open 4.72 calls for every put in the past two weeks.

Outside of the options pits, sentiment remains bullish. Four brokerage firms currently cover Kite Pharma Inc (NASDAQ:KITE), and all of them call it a "strong buy."

Daily Chart of KITE Since January 2015 With 10-Day and 20-Day Moving Averages

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