Taking Profits In Genmab
Several of our biotech names are surging today. I’ve taken profits in Genmab (GMAB 0.00%↑) while keeping exposure to its next advances.
I also decided to exit Monday’s AXT (AXTI 0.00%↑) trade ahead of earnings for a $4.10 net credit—a gain of about 95% in two days.
Genmab’s positive Phase 3 results showed that petosemtamab plus pembrolizumab reduced the risk of death by 50% compared with pembrolizumab alone in the study’s first-line, PD-L1-positive advanced head and neck cancer population. Clinical readouts like this were the opportunity behind our September 10 trade:
The historical entry cards below show the ratings from Chartmill used in the original alerts.
Here’s the original entry card. We bought two February calls and sold one January call, leaving one February call with uncapped upside.
We entered this trade at a $1.50 net debit.
I bought that extra February 19, 2027 $40 call for $2.22 and sold it for $18.75—a gain of about 745% on that call.
I’m keeping the GMAB calendar open. The put spread closed earlier today.
More Biotech Momentum
Replimune (REPL 0.00%↑) was up about 24% this afternoon. In today’s business update, it said its melanoma treatment TUDRIQEV had reached patients and more than 15 institutions had prescribed it. Here’s our original trade:
Prime Medicine (PRME 0.00%↑), our gene-editing exposure, is also moving sharply higher today. We entered that trade on September 25:
Where Biotech Meets AI
Twist Bioscience (TWST 0.00%↑) is participating in today’s rally too. It launched an antibody screening service designed to help researchers test thousands of candidates a day, with turnaround starting at five days. That’s the physical testing capacity AI-driven drug discovery needs. We remain bullish and are holding our October 21 trade:
AXT (AXTI 0.00%↑), whose substrates help make the optical connections used in AI data centers, has had a strong week. We entered our latest trade Monday, ahead of Thursday’s after-close earnings:
Here’s the trade we entered Monday, with Chartmill ratings as of October 23:
We entered this trade at a $2.10 net debit.
I closed it today for a $4.10 net credit, a gain of about 95% on its original maximum risk in two days.
I exited Monday’s trade by selling to close three November 6 $57 calls and buying to close three October 30 $62 calls together for a $4.10 net credit. Here’s my updated exit order:
Our older July 31 AXTI trade stays open. I’ll consider an additional AXTI earnings trade after the close.