Deutsche Bank downgraded AZN to “sell”
Biopharmaceutical stock AstraZeneca PLC (NASDAQ:AZN) is 1.3% lower before the open, after a bear note from Deutsche Bank. The analyst downgraded AZN to “sell” from “hold” and lowered its price target, pointing to the company’s results from a lung cancer trial that showed its experimental precision drug did not improve overall survival.
Coming into today, most analysts were bullish on AstraZeneca stock. Of the 14 in coverage, 11 rated it a “buy” or better, and the 12-month average target price of $90.89 is a 15.1% premium to last night’s close, meaning more downgrades and/or price-target cuts could roll in.
The options pits are much more bearish. This is per the security’s 10-daypt utu/call volume ratio of 2.36 over at the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX). This ratio ranks higher than 92% of annual readings, showing puts are getting picked up at a much faster-than-usual rate.
Speculating on AZN’s next move with options could be the way to go. The stock’s Schaeffer’s Volatility Index (SVI) of 21% stands higher than 26% of all other readings in its annual range, implying that options players are pricing in low volatility expectations at the moment.
Shares have pulled back since their Aug. 30, all-time high of $87.66, yesterday closing below their 100-day moving average for the first time since March. What’s more, AZN is on track to record a roughly 10% monthly loss — its worst since September 2022 — and is looking to cut into its 17.2% year-to-date lead.