Abivax (ABVX) Surges 9.2% Amid Whispers of Eli Lilly Takeover—Is This the Start of a Biotech Power Play?

Summary
• Abivax’s shares jumped 20% in Paris on Wednesday, fueled by rumors of a potential Eli Lilly bid.
• The stock hit a 52-week high of $137.0 and a market cap of €8B ($9.3B), up from €500M in January.
• Positive Phase 3 trial results for obefazimod in ulcerative colitis and a $400M ADR offering in July catalyzed earlier gains.

Abivax’s 9.2% intraday surge to $134.365 has ignited speculation about a blockbuster biotech deal. With a 52-week range of $4.77–$137.0 and a dynamic PE of -44.08, the stock’s volatility reflects its speculative allure. The move aligns with broader biotech sector momentum, though sector-specific risks remain.

Eli Lilly Takeover Rumors Ignite Abivax's Volatility
The 9.2% intraday surge in Abivax’s shares is directly tied to market speculation about a potential acquisition by Eli Lilly, as reported by Reuters. Analysts, including Damien Choplain of Stifel, attribute the move to 'speculation around a possible takeover,' despite no official confirmation from either company. This follows Abivax’s July announcement of positive Phase 3 trial results for obefazimod in ulcerative colitis, which had already driven its Paris-listed shares up over 500% in a single day. The stock’s current trajectory reflects a combination of short-term takeover hype and long-term optimism about its drug pipeline, though the lack of profitability (negative EPS of -$3.41) and high volatility (834.79) underscore the risks.

Options Playbook: Leveraging ABVX's Volatility with High-Gamma Calls
• MACD: 4.32 (bullish divergence from signal line 5.38)
• RSI: 58.57 (approaching overbought territory)
• Bollinger Bands: Upper $131.07, Middle $115.98, Lower $100.89 (price near upper band)
• 200D MA: $47.77 (far below current price)

Abivax’s technicals suggest a continuation of its short-term bullish trend, with RSI nearing overbought levels and MACD indicating momentum. Key support/resistance levels at $98.32–$99.00 (30D) and $5.17–$7.63 (200D) are irrelevant given the current price. The stock’s 11.59% intraday gain and 1,847.45% YTD return highlight its speculative nature, though its -44.08 dynamic PE and -148.98% ROE caution against overexposure.

Top Option 1: ABVX20251219C130
• Strike: $130, Expiration: 2025-12-19, IV: 169.85% (extreme volatility)
• Delta: 0.6095 (high sensitivity to price moves), Gamma: 0.0101 (strong gamma for rapid premium changes)
• Theta: -0.9989 (rapid time decay), Turnover: $176,585 (high liquidity)
• Leverage Ratio: 7.71% (moderate leverage)
• Price Change Ratio: 47.39% (strong momentum)
• Payoff (5% upside): $134.365 → $141.08 → max(0, $141.08 - $130) = $11.08 per share
This call option is ideal for aggressive bulls capitalizing on the takeover narrative. Its high gamma and delta ensure rapid premium gains if the stock breaks above $130, while the 169.85% IV reflects market anticipation of volatility.

Top Option 2: ABVX20260515C155
• Strike: $155, Expiration: 2026-05-15, IV: 31.43% (moderate)
• Delta: 0.3153 (lower sensitivity), Gamma: 0.0128 (moderate gamma)
• Theta: -0.0415 (slow decay), Turnover: $0 (low liquidity)
• Leverage Ratio: 26.46% (low leverage)
• Price Change Ratio: 0.00% (no recent movement)
• Payoff (5% upside): $134.365 → $141.08 → max(0, $141.08 - $155) = $0 (out-of-the-money)
This contract is less compelling due to low liquidity and out-of-the-money status, but could benefit from a sustained rally beyond $155. However, its 31.43% IV and low delta make it a weaker play compared to the December 19 call.

Action: Aggressive bulls should prioritize ABVX20251219C130 for a short-term bet on the takeover narrative. If $130 holds, consider rolling into longer-dated options. Conservative traders may wait for a pullback to $131.07 (Bollinger upper band) before entering.

Backtest Abivax Stock Performance
The backtest of ABVX's performance after a 9% intraday surge from 2022 to the present reveals positive short-to-medium-term gains, with the 3-Day win rate at 57.53%, the 10-Day win rate at 57.92%, and the 30-Day win rate at 64.09%. The maximum return during the backtest was 24.99% over 30 days, indicating the strategy's effectiveness in capturing intraday volatility.

Abivax at a Crossroads: Ride the Wave or Secure Profits?
Abivax’s 9.2% surge reflects a perfect storm of takeover speculation and drug development optimism, but its -44.08 dynamic PE and -148.98% ROE highlight structural risks. The stock’s 1,847.45% YTD return and 834.79% volatility suggest a high-stakes game. Traders should monitor the $130 level for ABVX20251219C130 and the $131.07 Bollinger upper band. Meanwhile, sector leader Amgen (AMGN) rose 0.4% intraday, underscoring broader biotech resilience. Act now: Secure profits if $130 breaks, or ride the momentum with the December 19 call.