Option Bulls Pounce On Inovio Pharmaceuticals Inc (INO) Amid Vaccine News

Inovio Pharmaceuticals Inc (NASDAQ:INO) call options are hot thanks to promising data on the biotech's experimental chikungunya virus vaccine

by Josh Selway

Published on Mar 22, 2016 at 11:41 AM
Updated on Jun 24, 2020 at 10:16 AM

While overall option volume remains light on an absolute basis, calls are nonetheless crossing at an accelerated clip today on biotech stock Inovio Pharmaceuticals Inc (NASDAQ:INO). Specifically, call volume is running at more than two times the intraday average, arriving in the 95th percentile of its annual range. The most popular option by far is the January 2017 12-strike call, though it's unclear how option traders are positioning themselves here. 

Call buying has historically been the go-to strategy in INO's options pits. For instance, over nine calls have been bought to open for every put during the past two weeks at the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX). However, some of this activity -- especially at out-of-the-money strikes -- may be due to short sellers buying insurance, since over one-fifth of INO's float is sold short, or 10.80 times its average daily trading volume. 

There's no question where analysts stand, though. All five that cover INO say it's a "strong buy," with the stock's average 12-month price target coming in at $19 -- more than twice the shares' current price, and in territory not charted since early 2005. 

This optimism is warranted by the fact that Inovio Pharmaceuticals Inc (NASDAQ:INO) has advanced 71% since its late-January two-year low of $4.50 -- boosted by some positive developments surrounding its Zika vaccine. Today, INO is up 6.2% at $7.70, after the company presented promising data on its experimental chikungunya virus vaccine

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