CV Therapeutics (NASDAQ:CVTX) is a biopharmaceutical firm that engages in the discovery, development, and commercialization of small molecule drugs for the treatment of cardiovascular diseases. The company develops a drug candidate, Ranexa, for the treatment of chronic angina, a debilitating heart condition. It also develops Regadenoson, an A2A-adenosine receptor agonist for use as a pharmacologic agent in cardiac perfusion imaging studies; Tecadenoson, an A1-adenosine receptor agonist for the reduction of rapid heart rate during atrial arrhythmias; and Adentri, an A1-adenosine receptor antagonist for the treatment of congestive heart failure. The company has collaboration with Astellas US LLC to develop and market pharmacologic cardiac stress agents; Biogen Idec, to develop and commercialize new drugs in the Adentri program based on A1-adensoine receptor antagonist patents and technologies; and Solvay Pharmaceuticals, to copromote ACEON, an angiotensin converting enzyme inhibitor with tissue activity for the treatment of hypertension.
The recent bullish activity in equities has provided a number of favorable candidates for cash-secured puts and although the OW Portfolio is fully margined, we felt it was appropriate to offer a new position for readers who have a little extra collateral in their brokerage accounts. CV Therapeutics emerged in one of our proprietary scans and based on the stock's upside momentum, it appears there may be some positive news in the company's future. Regardless of the reason for the buying pressure, the issue has relatively solid (technical) support near the cost basis in this position and we believe it offers conservative traders a favorable risk versus reward outlook.
Fundamentals Chart Earnings Dates Analyst Ratings
Suggested (Bullish) Option Position:
Sell Put JUL 20.00 UXC-SD
Target Price = $0.40 Open Interest = 5419
Potential Profit (5 contracts @ $0.40) = $200
Initial Margin (5 contracts) = $3,220
Return on Investment (max) = 7.3%
Cost Basis in Stock = $19.60
Days to Expiration = 26