Price Forecast:

Bullish Case: Sarepta's FDA approvals and promising pipeline advancements position it well for substantial growth, countering legal challenges. Implied volatility trends suggest favorable trading conditions for bullish strategies as market sentiment improves.

Bearish Case: Ongoing patent infringement lawsuits and mixed trial results pose significant risks to Sarepta's financial stability, compounded by high implied volatility that reflects market anxiety about potential declines.

Potential Outcomes:

1. Favorable resolution of patent lawsuits (40% likelihood) boosting stock price.


2. Adverse legal outcomes leading to stock drop (30% likelihood).


3. FDA rejections affecting growth (30% likelihood).

Trading Oracle: Adopt a bullish strategy with debit spreads, buying the $125 call and selling the $130 call, targeting expiration in January 2025. This setup leverages implied volatility and high probabilities of favorable outcomes while hedging downside risks.

November 14, 2024