Bears Pounce as Drug Data Drops Intercept Pharmaceuticals, Inc. (ICPT)

Intercept Pharmaceuticals Inc (ICPT) is reeling on poorly received trial results

May 19, 2015 at 10:45 AM
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Poorly received drug trial data is clobbering shares of Intercept Pharmaceuticals Inc (NASDAQ:ICPT) this morning. At last check, the biopharmaceutical stock has plunged 9.6% to hover near $283.56, and has landed on the short-sale restricted list. Not surprisingly, put volume has exploded, as speculators look for alternate ways to bet bearishly on the security.

Specifically, ICPT puts are crossing the tape at five times the expected intraday rate. The most active strike is the June 270 put, where traders are initiating long positions -- counting on the shares to plunge below $270 by front-month expiration, at the close on Friday, June 19. Earlier, the stock hit an intraday low of $269.

This short-term skepticism is out of sync with recent options trends. Specifically, ICPT's Schaeffer's put/call open interest ratio (SOIR) rests at an annual low of 0.34. In other words, call open interest outweighs put open interest by an extreme margin, among options expiring in the next three months.

Analysts are also quite optimistic toward ICPT. Of the nine analysts tracking the stock, eight have doled out "buy" or better ratings, with the lone outlier sporting a "hold."

Technically speaking, Intercept Pharmaceuticals Inc (NASDAQ:ICPT) has performed incredibly this year, today notwithstanding. Even after accounting for this morning's downside gap, the stock remains 82% higher in 2015.
 

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