Why Analysts Say This Penny Stock Can Double

Options traders have been targeting ACRX stock, too

Oct 15, 2018 at 1:15 PM
facebook twitter linkedin


The shares of AcelRx Pharmaceuticals Inc (NASDAQ:ACRX) surged almost 37% last week -- their biggest one-week gain since September 2017 -- after a Food and Drug Administration (FDA) panel deemed the company's opioid treatment safe. ACRX stock is up another 10.5% today to trade at $4.40, earlier hitting an annual high of $5.03, after seeing an onslaught of bullish brokerage notes.

For starters, Cantor Fitzgerald said the "future looks bright" for AcelRx Pharmaceuticals, and that it believes "upward earnings revisions will drive upside momentum in ACRX stock." Plus, Jefferies upgraded ACRX to "buy" from "hold," waxing optimistic on potential FDA approval for the opioid drug. And H.C. Wainwright joined both these brokerages in raising their price targets for ACRX to $8 -- a 101% premium to last Friday's close.

Options traders have been blitzing ACRX, too, with both put and call open interest perched at new annual peaks of 13,903 contracts and 39,742 contracts, respectively. The December 5 call is home to peak open interest of 8,706 contracts, while the October 5 call is the most heavily populated strike in the front-month series, with 7,398 contracts outstanding.

Today, 14,049 calls have changed hands so far -- nearly nine times what's typically seen at this point in the day, and volume at a new 12-month high. By comparison, fewer than 1,400 puts are on the tape. The October and December 5 calls are most active, though it's not clear if positions are being opened or closed.

Looking closer at the charts, ACRX's stock took a sharp bounce off its 200-day trendline during last week's surge. The shares are now up nearly 117% year-to-date, and could soon find a new foothold near $4.30, home to their mid-June highs.

acrx stock daily chart on oct 15

What This Election Year Means for Stocks

Ipad with I voted sticker

  


 
Special Offers from Schaeffer's Trading Partners