Human Genome Sciences (HGSI) is up 77 cents to $9.90 and options volume on the biotech is elevated, with 35,000 calls and 8,430 puts traded in the name so far. The top trades surfaced early when one strategist sold 1,900 February 8 puts at 18 cents and sold 1900 February 9 puts at 48 cents to buy 6,650 February 11 calls for 42 cents. The bullish play comes as shares attempt a rebound in 2012. After plummeting to a 52-week low of $6.51 in late-December, from a 52-week high of $30.15 in April, HGSI has rallied more than 50 percent in a little over a month. The stock was weighed down in 2011 by two quarters of hefty losses despite the FDA approval and commercialization of Lupus drug Benlysta. 21,150 Feb 11 calls now traded on the stock today, however, (against 932 in open interest) as some investors might be betting that the company will have some positive commentary about Benlysta sales in the weeks ahead. Roche’s bid for Illumina is likely giving HGSI a bid as well and implied volatility in the options on the stock is moving higher along with the underlying today — up 19.5 percent to 88.
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Article source: http://www.schaeffersresearch.com/marketcenters/optionscenter/default.aspx?c=bytefeed&ID=109765&single=true
