Put Buyers Pounce Amid Biogen Inc. (BIIB) Pullback

Biogen Inc (BIIB) has been struggling since topping out at $480.18 in late March

by Alex Eppstein

Published on Apr 27, 2015 at 2:13 PM
Updated on Jun 24, 2020 at 10:16 AM

Biogen Inc (NASDAQ:BIIB) is struggling in the wake of mixed brokerage attention and an uninspiring day for pharmaceuticals, down 2.6% to trade at $391.15. This negative price action is luring option bears to the table, as puts are crossing at more than twice the pace expected at this point in the day.

Diving right in, the weekly 5/1 380-strike put is seeing notable activity. All indications hint at newly purchased positions at the out-of-the-money strike, suggesting traders foresee BIIB falling below $380 by this Friday's close, when the weekly options expire.

On the charts, the biotech stock has had a nice run in 2015, adding about 15%. While BIIB has pulled back since topping out at a record $480.18 in late March -- and suffered a post-earnings bear gap last week -- it appears the shares have found a foothold this afternoon at their 100-day moving average.

Shifting our attention to the Street, BIIB is well-loved by analysts. In fact, 80% of the brokerage firms tracking the equity recommend buying it, and the average 12-month price target of $480.37 represents a nearly 23% premium to current trading levels, and sits in uncharted territory.

As mentioned earlier, though, Biogen Inc (NASDAQ:BIIB) received more mixed attention during the overnight hours. Specifically, while Nomura boosted its price target to $442 from $401, Oppenheimer started coverage with a tepid "perform" rating, and Morgan Stanley cut its price target to $520 from $524.

A Schaeffer's 39th Anniversary Exclusive!

8 Top Stock Picks for 2020

Access your FREE insider report before it's too late!