Orphazyme (ORPH) surged 61.3% to close at $16.21 on June 15. Orphazyme is a late-stage biopharma company that develops therapies to treat genetic disorders.
With a market capital of 566.6 million, the meme stock skyrocketed 1387% in the June 10 trading session, on the chatter building on WallStreetBets and other social media platforms about the potential for short squeezes. Orphazyme was the eighth most-mentioned stock on Reddit's Wall Street Bets.
Furthermore, over the past five days, the stock has rocketed higher by 211.7% and is up 66.9% over the past year.
Why the Surge?
On June 15, Orphazyme disclosed to investors that one of the company's largest investors, the Sunstone Life Ventures fund, had sold its shares, leaving the shareholders to speculate that there could be a chance of a potential merger.
Furthermore, the U.S. Food and Drug Administration is soon expected to issue an approval decision regarding an application for the company's lead drug, Arimoclomol. This drug will be used to treat a lysosomal storage disorder called Neimann-Pick Disease Type C.
The stock has picked up a rating from one analyst in the past three months. Merrill Lynch analyst Tazeen Ahmad downgraded the stock to Sell from Neutral and assigned an Orphazyme price target of $5 (69.2% downside potential).
TipRanks’ Stock Investors tool shows that investors currently have a Very Positive stance on Orphazyme, with 670.6% of investors who maintain portfolios on TipRanks increasing their exposure to ORPH stock over the past 30 days.
Reflecting that sentiment, TipRanks' data shows that financial blogger opinions are 100% Bullish on ORPH, compared to a sector average of 70%.
Disclosure: Shalu Saraf did not own any shares mentioned in this article at the time of publication.
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