CDMO Forecast


Bullish Case: Avid Bioservices may benefit from rising biopharmaceutical demand and a growing CDMO market, potentially leading to higher revenues and stock price recovery as operational efficiency improves.


Bearish Case: Weak financial performance and high price-to-book ratios may continue to pressure CDMO's stock. Volatility in the sector could further erode investor confidence, leading to declining stock prices.


Potential Outcomes:

1) Increased demand for CDMO services (40%);

2) Continued weak financial performance (55%);

3) Potential partnerships driving growth (30%);

4) Market downturn focusing on cost-cutting (50%).


Trading Oracle: Consider a short volatility strategy using credit spreads, aiming to capitalize on mean reversion. Focus on near-term OTM puts to manage risk effectively in a bearish environment. Target stability in pricing with minimal losses.


July 24, 2024


Avid Bioservices Forecast

CDMO      Avid Bioservices











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Assets that tend to move strongly with CDMO



XLE Forecast + Options Trading Strategies   XLE  Energy Select Sector SPDR (0.42)


VFC Forecast + Options Trading Strategies   VFC  VF (0.16)


LI Forecast + Options Trading Strategies   LI  Li Auto (0.09)


ETRN Forecast + Options Trading Strategies   ETRN  Equitrans Midstream (0.07)



Uncorrelated Assets

Assets with little price relationship to CDMO



ETRN Forecast + Options Trading Strategies   ETRN  Equitrans Midstream (0.07)


LI Forecast + Options Trading Strategies   LI  Li Auto (0.09)


VFC Forecast + Options Trading Strategies   VFC  VF (0.16)


XLE Forecast + Options Trading Strategies   XLE  Energy Select Sector SPDR (0.42)



Anticorrelated Assets

Assets that tend to move strongly against CDMO



XLE Forecast + Options Trading Strategies   XLE  Energy Select Sector SPDR (0.42)


VFC Forecast + Options Trading Strategies   VFC  VF (0.16)


LI Forecast + Options Trading Strategies   LI  Li Auto (0.09)


ETRN Forecast + Options Trading Strategies   ETRN  Equitrans Midstream (0.07)





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