The Sorrento Therapeutics (NASDAQ:SRNE) stock had been regarded as a ‘coronavirus play’ by investors in the past and on Thursday, the stock was back in favour. There was no news about the company yesterday but the stock still soared by 12.50% and took its gains for the past month to as much as 30%.
However, it seems that the spike in COVID 19 cases across the world may have led to the popularity in the stock since investors possibly believe that it is going to eventually lead to higher demand for Sorrento’s COVID 19 testing product COVI-STIX.
Not too long ago, the product was awarded with an Emergency Use Authorization in Mexico and that development is significant considering the fact that cases are rising in that country. In the past month, cases have gone up by as much as 50%.
The company applied to the United States Food and Drug Administration for a similar authorization last year. In addition to that, Sorrento is also currently working on getting permission for COVI-STIX from the regulators in Europe. The World Health Organisation reported yesterday that the seven day average number of cases in Europe has gone up by 10%. Hence, the spike in the Sorrento stock is understandable.
Market Reaction:
On Thursday, SRNE stock soared 13.42% to $10.99 with more than 26.47 million shares, compared to its average volume of 7.22 million shares. The stock has moved within a range of $9.64 – 11.07 after opening the trade at $9.73. Over the past 52-week, the stock has been trading within a range of $ 5.17 – 19.39.
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