TESARO Inc (NASDAQ:TSRO) stumbled to the finish line in 2017, shedding 2% in December alone. To make matters worse, the biotech stock is starting off 2018 reacting to a flurry of bearish analyst attention -- sending the shares even deeper into the red.
Piper Jaffray and Cowen and Company both issued price-target cuts to $80 for Tesaro this morning. As such, TSRO stock has dropped 8.8% at last check to trade at $75.61, while touching a 19-month low of $74.57 earlier today. TSRO shares have shed nearly 44% year-over-year, and their 30-day moving average has kept a lid on any breakout attempts since mid-October.
However, analysts remain relatively optimistic. Of the 17 brokerage firms covering TSRO, nine rate the stock a "buy" or "strong buy." Furthermore, TSRO's average 12-month price target of $140.47 is an 86% premium to the equity's current perch. This suggests the biotech stock could be overdue for both downgrades and further price-target cuts.
In the options pits, calls have been bought to open over puts at a faster-than-usual clip, albeit amid relatively low absolute volume. Data from the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) reveals a 10-day call/put volume ratio of 8.96, which ranks 3 percentage points from a 52-week high.
With 21% of the stock's float sold short, though, some of this is likely at the hands of shorts hedging against any upside risk. Today, however, TSRO stock is on the short-sale restricted list, which may explain why put volume has surged to three times the average intraday rate.