Indivior Surges 12.35%, Can This Momentum Fuel a New Era in Addiction Treatments?

Summary
• Indivior (INDV) surges 12.35% to $19.55, hitting a 52-week high of $21.01
• Q2 revenue of $302M exceeds $241.67M estimates, driven by 9% SUBLOCADE growth
• Raised 2025 guidance to $1.03B–$1.08B revenue and $275M–$300M adjusted EBITDA
• Options chain shows INDV20250815C20 call option surging 16.67% amid high implied volatility

Indivior’s shares erupted in premarket trading after the company announced Q2 revenue of $302M, driven by 9% growth in SUBLOCADE net revenue to $209M. With a 52-week high of $21.01 and a 12.35% intraday gain, the stock is trading at 12.96x dynamic PE. The options market is heating up, with the INDV20250815C20 call option showing 57.03% implied volatility. This surge follows management’s strategic pivot to streamline operations and boost U.S. SUBLOCADE growth.

SUBLOCADE Revenue Surge and Strategic Reforms Ignite Investor Optimism
Indivior’s 12.35% surge is directly tied to its Q2 financial results, which showed a 9% year-over-year increase in SUBLOCADE net revenue to $209M, outpacing the $241.67M revenue estimate. CEO Joe Ciaffoni’s strategic focus on U.S. SUBLOCADE growth and organizational simplification has reinvigorated investor confidence. The company raised 2025 revenue guidance to $1.03B–$1.08B and adjusted EBITDA to $275M–$300M, reflecting improved pricing stability in SUBOXONE Film and reduced generic competition. Additionally, the inclusion in Russell Equity Indexes and leadership additions like Patrick Barry and Vanessa Procter have signaled operational momentum.

Bullish Technicals and High-Leverage Options Signal Aggressive Entry Points
• MACD: 0.855 (bullish divergence) | RSI: 75.31 (overbought) | Bollinger Bands: 17.595 (upper) / 16.036 (middle) / 14.478 (lower) | 200D MA: 11.38 (far below price)
• Key levels: 19.32 (intraday low), 20.94 (open), 21.01 (52W high). RSI overbought and MACD above signal line suggest continuation of bullish momentum.
• Leveraged ETF: MILN (Global X Millennial Consumer ETF) up 0.79% aligns with consumer health trends but lacks direct exposure to pharma.

Top Option 1: INDV20250815C20 (Call, Strike $20, Expiry 8/15) | IV 57.03% | Leverage 27.77% | Delta 0.436 | Theta -0.0498 | Gamma 0.1696 | Turnover $10.44K
• IV at 57% indicates high volatility expectations; leverage amplifies returns if price stays above $20. Delta near 0.45 ensures sensitivity to price moves. Gamma of 0.17 means theta decay slows as price rises, favoring a bullish scenario.
Payoff: Projected $21.00 price (5% upside) yields $1.00 profit per share. Leverage ratio implies 27.77x return on $10.44K turnover.

Top Option 2: INDV20250919C17.5 (Call, Strike $17.5, Expiry 9/19) | IV 90.18% | Leverage 5.37% | Delta 0.691 | Theta -0.0311 | Gamma 0.0538 | Turnover $15.05K
• IV at 90% suggests market pricing in significant volatility. Delta of 0.69 ensures strong directional exposure. Gamma of 0.0538 implies moderate sensitivity to price swings. Theta of -0.0311 indicates manageable time decay over two months.
Payoff: $21.00 price yields $3.50 profit. LVR of 5.37x on $15.05K turnover offers balanced risk-reward.

Trade Setup: Aggressive bulls may consider INDV20250815C20 for short-term gains if $20.50 is cleared. INDV20250919C17.5 suits a mid-term hold as the stock consolidates above $19.32. Avoid INDV20250815P17.5 (IV 23.67%) due to low delta (-0.014) and negligible leverage.

Backtest Indivior Stock Performance
The backtest of INDI's performance after a 12% intraday surge shows mixed results. While the stock experienced a positive return, the win rate and return metrics vary across different time frames.1. Overall Win Rate and Return: The 3-day win rate is 48.57%, the 10-day win rate is 48.98%, and the 30-day win rate is 51.43%. This indicates that the stock tends to have a higher probability of positive returns in the short to medium term after the intraday surge.2. Return Metrics: The average 3-day return is 0.06%, the 10-day return is 0.12%, and the 30-day return is 1.28%. The maximum return during the backtest period is 1.57%, which occurred on day 45 after the surge.3. Variation Across Time Frames: The returns and win rates show a general upward trend as the time frame increases, with the 30-day win rate and return being the highest. This suggests that the stock's performance tends to be more robust in the longer term following the intraday surge.In conclusion, while a 12% intraday surge in INDI has historically led to positive returns, the immediate post-surge performance is somewhat muted, with the bulk of the return potentially accrued over a 30-day period. Investors looking to capitalize on such events should be prepared for a potentially lengthy wait for maximum returns.

Bullish Momentum Unlikely to Subside—Position for a Breakout Above $20.50
Indivior’s 12.35% surge is fueled by SUBLOCADE’s 9% growth, strategic reforms, and revised 2025 guidance. Technicals show overbought RSI and bullish MACD, suggesting continuation of the rally. The INDV20250815C20 call option offers 27.77x leverage for a short-term play, while the INDV20250919C17.5 provides a balanced mid-term bet. Watch for a breakout above $20.50, which could trigger a test of the 52-week high at $21.01. Meanwhile, sector leader Johnson & Johnson (JNJ) fell 1.04%, highlighting pharma sector volatility. Investors should prioritize options with high gamma and moderate theta to capitalize on near-term volatility.