Q2 STOCKS TO BUY

Sarepta Therapeutics Inc (SRPT) Option Bulls Bet On New Highs

Sarepta Therapeutics Inc (NASDAQ:SRPT) call options have been popular, but there may be an ulterior motive for these traders

Dec 18, 2015 at 2:24 PM
facebook X logo linkedin


Call buyers have been piling into Sarepta Therapeutics Inc's (NASDAQ:SRPT) options pits recently. Looking at data from the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), the equity boasts a 10-day call/put volume ratio of 15.16. This reading outranks 78% of all others from the past year, meaning there's been a greater-than-usual appetite for long calls over long puts recently. 

Echoing this preference for calls is SRPT's Schaeffer's put/call open interest ratio (SOIR). At 0.44, it shows that call open interest more than doubles put open interest, among options that expire within the next three months. 

This trend is continuing today. Call volume is accelerated, and the most popular option by a long shot is the May 50 call. It's likely traders are buying to open the deep out-of-the-money call, betting on SRPT to topple the half-century mark by May expiration -- for the first time since October 2013. 

Widening the sentiment scope, though, shows these call players may actually be short sellers looking for insurance. Short interest increased by over 12% during the past two reporting periods, and now accounts for more than one-fourth of SRPT's float. 

Elsewhere, analysts are mostly bullish on the drugmaker. Twelve brokerage firms are covering the stock, eight of which say it's a "buy" or better, with none calling it a "sell." Additionally, SRPT's consensus 12-month price target of $46.75 is located in two-year-high territory. 

The shares are enjoying a 161% lead in 2015, recently consolidating gains from a late-November bull gap. Today, traders are responding to news that rival drug company BioMarin Pharmaceutical Inc.'s (NASDAQ:BMRN) muscular dystrophy drug still hasn't been approved by the Food and Drug Administration (FDA). As a result, Sarepta Therapeutics Inc (NASDAQ:SRPT) has gained 5.6% to hit $37.82.
 
 

“Buy This Stock Now!” - Expert Who Called 11x On TSLA

He called a rare 11x on Tesla…

But now, thanks to Elon & Trump’s new alliance…

He says there’s a new opportunity that could be 1,000x BIGGER than Tesla – and it could completely revolutionize a $23 Trillion market.

It’s trading for less than $5 per share right now…

But it won’t be under the radar for long.

Discover The 1,000x Bigger Elon Opportunity Here

GRAND SLAM COUNTDOWN

 
 

Featured Articles from Trusted Partners:

👀Learn How Dividends Create Passive Income for Life
Receive $200 Off Motley Fool Epic. The Motley Fool Epic $299 discounted offer is based on $499/year list price. Introductory promotion for new members only. Take control of your money and your portfolio with Motley Fool Epic.

💵New Income System Could Pay You $4,243 Monthly
You could collect an average of $4,243 per month starting as early as next week with a new payout system for income investors. New registrations are being accepted for investors who want to be in a position to start with their first payout next week.

🚀Easy 92% Crypto Dividends (No Coins Required)
COIN stock doesn't pay a dividend... But there's actually a new way to collect a massive dividend that's indirectly based on the stock and offers a terrific monthly income (currently yielding nearly 92% on a forward basis).

🤝Free Advisor Match with Wiseradvisor.com
Don't leave your retirement to chance! Get matched with a trusted financial expert for FREE and make the most of your tax refund. Get started now.

⚠️Dennis Quaid's #1 Warning for Americans
Here's the thing: life doesn't come with guarantees. The economy shifts, markets stumble, and years of hard work could slip through your fingers like sand. But it doesn't have to be that way for you. So request a free copy of this Gold & Silver Guide that will arrive right to your doorstep when you act now.

 

 
 

Follow us on X, Follow us on Twitter