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Biotech / Medical : Biotech Valuation -- Ignore unavailable to you. Want to Upgrade?

To: keokalani'nui who wrote (5043)	12/3/2001 5:59:28 PM
From: Biomaven	Read Replies (1) \| Respond to of 52153

Someone noted the PCYC implied volatility: (NASDAQ:PCYC) Pharmacyclics, Inc. (NM) U.S. Options-Pharmacyclics vols stay high, volume up -Dec 3, 2001 05:22 PM (Reuters) -http://finance.lycos.com/home/news/story.asp?story=25590377 ======================================================= CHICAGO, Dec 3 (Reuters) - Implied volatility stayed high on Monday in options on cancer drug maker Pharmacyclics Inc. (NASDAQ:PCYC) for at least the fifth consecutive session, while options volume picked up again as the stock pulled back after its recent ascent. Near Monday's close, roughly 1,195 calls and 550 puts had changed hands on the Philadelphia Stock Exchange. That exceeded average daily turnover during the last 20 trading sessions of about 315 contracts, and was the highest one-day options turnover since mid-August 2000, when a similar number of options changed hands, according to Track Data figures. Last week, options volume popped up Nov. 26 for a single session to more than 1,500 contracts, Track Data showed. Options volume on Monday also tilted toward calls as the stock lost ground, reversing the trend of the few most recent sessions when put volume dominated as the stock advanced, perhaps as players tried to protect profits. An American-style call option gives its buyer the right to purchase the underlying stock at a specific strike price any time during the option's life. A put conveys a similar right to the buyer except to sell the underlying stock. The options specialist on the PHLX trading floor declined to comment on Monday's activity, citing company policy. "I've got it in the 94th percentile of implied volatility," said Sage Douglas, research assistant with McMillan Analysis Corp., of Pharmacyclics options. He said implied vols for all the option's strikes and expiries was 140.5 percent, up from an average lifetime implied of around 125 percent and well above the 100-percent level on Nov. 16 just before the stock and implied vols began rising in tandem. "So it is toward the more expensive end," he added of the implied volatility level recently. Implied volatility measures as a percentage how much the options market thinks the stock price will move during the option's life. The stock's 20-day historical volatility, or how much the stock actually has moved during that time, was 60 percent. That movement -- rising implied volatility as the stock advanced -- caught Douglas' attention because implied volatility typically declines as the stock rises and rises as the stock drops, reflecting the lesser likelihood a stock will run as far on the upside as it tends to move the downside. "A stock runup with high implied volatility means there could be some news," he added. "There might be something going on because implied volatility doesn't rise for no reason. If the reason is right, is another question. We don't know why." Stock of Sunnyvale, California-based Pharmacyclics had ratcheted upward from an intraday trough of $14.54 hit on Sept. 25 to an intraday high of $28.12 on Nov. 26. The stock closed on Monday at $24.41, down $1.11 or 4.35 percent, on the Nasdaq. Volume was 309,800 shares. Copyright 2001, Reuters News Service (emphasis added). "[M]ight be something going on" is right - they are due to announce their Phase III results, allegedly this month. Peter P.S. I've been long March calls for a while now.