Synergy Pharmaceuticals (NASDAQ: SGYP)
Synergy Pharmaceuticals has been a very interesting stock to watch as of late. Recently, the company released top-line data from the second of two Phase 3 studies looking into the experimental drug, plecanatide. The results showed that SGYP met its primary endpoint and pointed to an upcoming NDA. While we saw growth in the stock the day of the announcement, since then, we’ve seen a major battle between the bears and the bulls on the stock. Today, we’ll talk about what we’ve seen in the market and what we can expect to see moving forward. So, let’s get right to it…
What We’ve Seen From SGYP Since The Data Release
Since the plecanatide data was released, we’ve seen quite a bit of up and down activity. While the bulls see strong value in the stock, the bears have been shorting the heck out of it; leading to what I consider to be the ultimate battle between the bulls and the bears. Strangely enough, since the positive news from plecanatide, short interest seems to have risen. So, while the data provided the bulls with a reason to send the stock soaring, the bears have created incredible resistance at the top.
What We Can Expect From Synergy Pharmaceuticals Moving Forward
When it comes to SGYP, I have two conflicting opinions of what we’re going to see; depending on how far in the future you plan on looking. Here’s how I see it…
- Pre-NDA Outlook – We know that the next step for Synergy Pharmaceuticals is to submit a new drug application with the FDA. However, until we see this actually happen, I think that the battle between the bears and the bulls will continue to rage on; keeping Synergy Pharmaceuticals between $9.76 per share and $8.21 per share.
- Post-NDA Outlook – Nonetheless, that trading range isn’t likely to last forever. As a matter of fact, I’m expecting to see things change drastically as soon as the new drug application is submitted and more so after it has been approved. The reality is that if you look into the fundamental data associated with Synergy Pharmaceuticals, there’s absolutely no reason to be bearish on the stock. Therefore, as we continue to see good news in the race to get plecanatide to the market, we’re going to see resistance start to fade as the bulls take control.
All in all, I have an overwhelmingly bullish opinion of what we can expect from plecanatide in the long run; and I’m a firm believer that high short interest isn’t likely to last forever.
What Do You Think?
Where do you think SGYP is headed and why? Let us know in the comments below!