XenoPort spiked higher with positive news on one of its drugs yesterday, and traders are betting that the stock will hold those gains.
More than 1,700 October 5 puts were sold yesterday morning for $0.65 to $0.40, according to optionMONSTER's tracking systems. These are clearly new positions, as open interest in the strike was just 43 contracts before the session began.
These put sellers are looking for XNPT to stay above $5 through expiration in mid-October. If the stock falls below that level, the traders will be on the hook to buy the shares. (See our Education section)
XNPT soared 17.12 percent $5.89 yesterday, its highest close since mid-May. The biopharmaceutical company shot above its 50- and 100-day moving averages after releasing positive results for its multiple-sclerosis treatment in the morning.
Total option volume in the name was more than 8 times its daily average for the last month.
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