Zafgen Inc (ZFGN) is getting drilled, potentially on insider selling
Drugmaker
Zafgen Inc (NASDAQ:ZFGN) is one of the leading losers on the Nasdaq today, down 22.3% at $17.21, and on the short-sale restricted list for a second straight day. Rumblings around the Internet suggests heavy insider selling is to blame for the stock's swoon. Meanwhile, activity has erupted in ZFGN's options pits.
Diving right in, intraday option volume stands at 12 times the norm. October strikes account for six of the seven most active strikes this afternoon, as traders pick a direction ahead of this Friday night's front-month expiration.
Meanwhile, ZFGN's 30-day at-the-money implied volatility has shot 87.1 points higher to an annual acme of 288%. This only echoes the elevated volatility expectations surrounding the stock, as its
Schaeffer's Volatility Index (SVI) currently rests at a 12-month peak of 149%.
Elsewhere,
short sellers have been placing bearish bets on ZFGN, considering 9% of its float is sold short. At the stock's average daily volume, it would take close to one week to repurchase these positions.
Returning to the charts, today's steep loss is by no means a unique event for Zafgen Inc (NASDAQ:ZFGN). Just yesterday, the shares tanked 35.6% after the company cancelled an investor meeting.