As of 2 p.m. New York time, Vaxart (VXRT), a biotech developing a coronavirus vaccine in a pill, was up 48.26% to $9.04. The stock had traded 151 million shares, about 11 times the average volume over the last 60 days.
The stock closed at $8.33 for a 37.46% gain on the day.
I think what we’re seeing is another one of those speculative moves built on a possible news event–Vaxart has announced a webinar for May 3 that is expected to include the release of new Phase 1 data on the efficacy of its Cover-19 vaccine in a pill–plus a plausible story–a vaccine in a pill would be exactly what India needs to stop its current pandemic surge and a vaccine in a pill would be helpful in convincing some of the vaccine hesitant to get vaccinated (no needle)–plus a big short position. According to Seeking Alpha short positions account for about 20.4% of total outstanding shares.
We’ve seen this kind of move before this year–GameStop (GME) is the lead example–and there’s certainly the possibility that today’s move is the result of traders pushing a plausible stock higher on news and a big short position.
Of course, there is also the possibility that Vaxart’s vaccine in a pill will work and that company that the company will announce positive efficacy results on May 2.
I’ve posted on Vaxart. I’ve owned it and sold it in my online portfolios. I hold options and shares in my personal portfolios.
Today I’m trying to thread the needle. In my personal portfolios I’ve sold all the Vaxart shares I bought in multiple lots at $6.00 to $7. I sold the Vaxart July 16 Call Options with a strike price of $7.50. But I held onto the July 16 Call Options with a strike price of $5.
My thinking is that in past speculative moves Vaxart has given back a good portion of those short term gains. If that’s the case, I’d certainly think about adding my options and share positions if I get an attractive price. Holding onto the July 16 Call Options with a strike of $5 keeps me in the game in case the stock continues to run until the May 3 meeting date.