Mirati Therapeutics, Inc. (NASDAQ:MRTX)
Traders are active in Mirati Therapeutics, Inc. (NASDAQ:MRTX) and are sending the shares up over 2.0% on heavy volume as of 10:30 AM EST. Last Friday MRTX stock essentially doubled after the biotech company released a statement announcing positive Phase 2 trial data on its two non-small cell lung cancer treatment trials using sitravatinib in combination with nivolumab (OPDIVO®).
The volatility of MRTX shares is showing up clearly in their option pricing as MRTX options are reportedly now being offered at some of the highest intrinsic values of any stock trading. Clearly the street believes that Mirati Therapeutics, Inc. (NASDAQ:MRTX) future may have a significant upside potential.
MRTX Share Action
MRTX shares gapped up to open today’s session but traders sold off the gains. Volume has been very heavy. The 30-day, daily average volume for MRTX is just over 1 million shares but only one hour into trading over 3.25 million shares have traded. If that pace continues throughout the session, MRTX shares will trade over 17 times their average volume.
Mirati Therapeutics, Inc. (NASDAQ:MRTX) has not traded above the $10 level since mid-2016 so resistance and support at current levels ($11.20) are dynamic and subject to shifting tides. However it is hard to deny that the stock is in rare air as the Relative Strength Index (RSI) hovers above 85. Typically, traders believe that a stock with an RSI above 70 is reaching “overbought” territory.
Analyst Reaction to MRTX
Prior to the release of positive Phase 2 trial data, analysts had assigned a consensus price target of $10.80 to MRTX shares. Of the seven firms that followed Mirati Therapeutics, Inc. (NASDAQ:MRTX), four gave the stock a rating of “Strong Buy” while three gave MRTX shares a “Hold” rating. The analysts believe that MRTX earning’s growth will be about four times the average for a company in the biotech sector. However, Mirati Therapeutics, Inc. (NASDAQ:MRTX) has yet to post a profit. As a matter of fact, last year was the largest per share loss shareholders experienced over the last three years.
I have no positions in any of the stocks mentioned, and have no plans to initiate any positions within the next 72 hours. All information, including any data, is provided without any guarantees of accuracy.
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About the author: Marc has a degree in economics and a MSc. in Finance. Over his 20-year career, Marc has worked for global investment firms in Europe and the United States as an analyst, fund manager, and consultant.