27% profit every 20 days?
This is what Nic Chahine averages with his option buys. Not selling covered calls or spreads… BUYING options. Most traders don’t even have a winning percentage of 27% buying options. He has an 83% win rate. Here’s how he does it.
In the absence of a potential buyout, the downside risk for La Jolla Pharmaceutical Company (NASDAQ:LJPC) is greater than the upside potential in the next two to three years, according to Jefferies.
The Analyst
ENTER TO WIN $500 IN STOCK OR CRYPTO
Enter your email and you'll also get Benzinga's ultimate morning update AND a free $30 gift card and more!
Jefferies analyst Eun Yang downgraded La Jolla from Buy to Underperform and lowered the price target from $40 to $29, suggesting 21-percent downside from current levels.
The Thesis
Polls with critical care physicians and pharmacy and therapeutics committee members showed only a modest sales opportunity for Giapreza, La Jolla's drug for low blood pressure, Yang said in a Monday note.
The Giapreza poll results point to 20- and 30-percent penetration of Giapreza in 2L and 3L, respectively, translating to a peak U.S. sales estimates of $324 million versus a prior estimate of $535 million, according to Jefferies.
The difference is due to lower transaction cost — $4,500 rather than the previous $8,000 — and a slightly higher number of patients.
Want Private Access to Benzinga Analyst?
Check out the latest strategies our team of experts are using every week so that you can always adapt to the market like the pros!—Get FULL Access to This Week's Webinar Here.
La Jolla shares have gained 15 percent year-to-date compared to a 1-percent drop for the Nasdaq Biotechnology Index.
In December, HC Wainwright initiated coverage of La Jolla with a Buy rating and a $62 price target, citing a Feb. 28 PDUFA date for LJPC-501, a treatment candidate for vasodilatory shock.
The Price Action
La Jolla shares are up about 90 percent over the past year.
Shares were sliding more than 7 percent percent to $34.21 Monday morning.
Related Links:
19 Biotech Stocks With Clinical Trial Outcomes In February
Attention Biotech Investors: February PDUFA Catalysts Come Calling
27% profit every 20 days?
This is what Nic Chahine averages with his option buys. Not selling covered calls or spreads… BUYING options. Most traders don’t even have a winning percentage of 27% buying options. He has an 83% win rate. Here’s how he does it.