MannKind Corporation (MNKD) Bulls Bet On a Bigger Bounce

MannKind Corporation (MNKD) is one of several pharma stocks on the move

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Published on Mar 10, 2015 at 2:27 PM
Updated on Apr 20, 2015 at 5:32 PM

It's been an eventful day for pharmaceutical stocks, with a number of names making big moves -- including MannKind Corporation (NASDAQ:MNKD). At last check, the shares were up 3.2% at $5.51. Turning to the options pits, a number of traders are wagering on additional upside for the equity.

MNKD's most active option by a mile is the in-the-money May 5 call. All signs point to buy-to-open activity, and based on the volume-weighted average price (VWAP) of $0.67, the speculators expect the stock will land above breakeven at $5.67 (strike plus VWAP) at the close on Friday, May 15 -- when the option expires.

Today's focus on calls represents a change of pace for MNKD. The equity's 50-day International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) put/call volume ratio of 0.67 ranks in the 76th percentile of its annual range. Similarly, MNKD's Schaeffer's put/call open interest ratio (SOIR) of 0.84 outstrips 73% of all comparable readings from the last year.

One group that's likely unhappy with MannKind Corporation's (NASDAQ:MNKD) intraday gains is short sellers. Roughly one-third of the stock's float is dedicated to short interest, representing 9.3 times the equity's daily trading volume.


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