SGEN Stock Rallies, Options Hot

Call buying has historically been popular on SGEN

Sep 30, 2019 at 2:31 PM
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Seattle Genetics, Inc. (NASDAQ:SGEN) is booming today, up 12% at $85.14, and earlier it hit an all-time high of $88.20, thanks to upbeat drug data presented over the weekend for its bladder cancer treatment. Analysts at Stifel, Guggenheim, and SVB Leerink all raised their price targets on the stock, the highest of $102 coming from the latter. Leerink also noted that SGEN is one of its favorite targeted oncology stocks. Meanwhile, there's also been interesting activity in the options pits.

SGEN call and put volume were almost equal at last check, both roughly doubling their average intraday volume. Leading the way is the October 90 put, followed by the October 80 put. On the call side, the October 90 strike is most popular. Call traders had already taken interest in the October series before today, with peak open interest standing at the October 80 call.

Looking back, almost five long calls have crossed for every put during the past 10 days at the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX). However, even that level of call buying is somewhat tame, since the 10-day call/put volume ratio on SGEN rose all the way up to 127.16 back in August.

sgen call buying2

Most analysts already like Seattle Genetics, with eight of the 13 in coverage sporting "buy" or "strong buy" recommendations. Not everyone on Wall Street is on board, though, since exactly seven days' worth of buying power is in the hands of short sellers. Of course, this latter point would indicate more tailwinds could come through for SGEN shares in the form of shorts covering their positions.

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