Price Forecast:

Bullish Case: Positive outcomes from the recent Phase 3 Zepzelca trial enhance JAZZ's growth potential. If the FDA gives favorable reviews, this could boost stock prices significantly, underpinned by strong market sentiment and reduced volatility.

Bearish Case: Insider selling and recent flat trading signal investor skepticism towards JAZZ's future growth. Uncertainty from pipeline developments and low historical performance raises concerns about potential declines in stock price.

Potential Outcomes:

1. Zepzelca approved, stock jumps 30% (40% chance);

2. Insider selling increases, stock drops 20% (30% chance);

3. Market stabilizes with minor movement (30% chance).

Trading Oracle: Consider a bull call spread targeting $130 strike for November expiry. With current implied volatility at 46.9%, this offers favorable risk-reward. Additionally, a bear put spread around $115 can hedge against downside risk given excessive sell pressure. Aim for a balanced portfolio with both bullish and defensive positions.

November 14, 2024