Protara Therapeutics Plummets 20.7%: Equity Offering Sparks Investor Exodus – What’s Next for TARA?

Summary
• Protara Therapeutics (TARA) plunges 20.7% intraday to $5.445, a 16.01% pre-market drop following a $75M equity offering.
• Intraday range of $5.07–$5.59 highlights sharp volatility amid heavy turnover of 4.86M shares.
• 52-week high of $7.82 and dynamic PE of -3.93 underscore biotech sector’s high-risk, high-reward profile.

Protara Therapeutics’ stock has imploded on Friday, driven by a $75M equity offering priced at $5.75 per share. The offering, coupled with a 30-day over-allotment option, has triggered a 20.7% intraday selloff. With TARA-002 in Phase II trials for bladder cancer and a $210M market cap, the move raises questions about capital allocation and investor sentiment in the biotech sector.

Equity Offering Sparks Investor Exodus
The 20.7% intraday plunge in TARA shares is directly tied to Protara’s $75M public offering, announced on December 4, 2025. The company priced 13.04M shares at $5.75, with an over-allotment option for 1.96M additional shares. Pre-market trading saw the stock drop to $5.77 (-16.01%), signaling immediate skepticism about the dilutive impact. The offering aims to fund TARA-002’s clinical development and general corporate purposes, but the sharp discount to the previous close of $6.87 has triggered a liquidity-driven selloff. Investors are interpreting the move as a sign of financial strain, despite TARA-002’s 72% complete response rate in BCG-naive NMIBC patients.

Biotech Sector Mixed as AMGN Leads Downside
The biotech sector remains fragmented, with Amgen (AMGN) down 2.55% intraday, reflecting broader risk-off sentiment. While Protara’s selloff is equity-offering specific, the sector’s exposure to regulatory uncertainty and high R&D costs amplifies volatility. TARA’s 20.7% drop contrasts with peers like VTYX (+9.5%) and PHVS (-5.94%), highlighting divergent capital flows. The offering’s impact on TARA’s market cap (now $210M) underscores the sector’s sensitivity to capital-raising events.

Options Playbook: Capitalizing on Volatility with TARA20251219P5 and TARA20260220P5
• 200-day MA: $3.96 (below current price); RSI: 66.33 (neutral); MACD: 0.509 (bearish divergence).
• Bollinger Bands: Upper $8.35, Middle $6.18, Lower $4.02 (price near lower band).
• Support/Resistance: 30D support at $5.07–$5.14; 200D support at $3.07–$3.16.

Top Options Contracts:
• TARA20251219P5 (Put, $5 strike, Dec 19 expiry):
- IV: 72.62% (elevated, reflecting volatility)
- Delta: -0.251 (moderate sensitivity to price moves)
- Theta: -0.0044 (slow time decay)
- Gamma: 0.397 (high sensitivity to price acceleration)
- Turnover: $13,898 (liquid)
- Leverage: 41.92% (attractive for short-term bearish bets)
- Payoff at 5% downside (5.175): $0.825 per contract (max profit if TARA breaks $5).
- Why it stands out: High gamma and leverage make it ideal for a sharp post-offering drop.

• TARA20260220P5 (Put, $5 strike, Feb 20 expiry):
- IV: 91.92% (high, but reasonable for longer-dated)
- Delta: -0.331 (moderate sensitivity)
- Theta: -0.0041 (slow decay)
- Gamma: 0.157 (moderate sensitivity)
- Turnover: $1,300 (adequate liquidity)
- Leverage: 8.38% (balanced risk-reward)
- Payoff at 5% downside (5.175): $0.825 per contract (hedges against prolonged bearishness).
- Why it stands out: Longer expiry and high IV offer protection against extended volatility.

Trading Setup: Aggressive short-sellers should target TARA20251219P5 for a 5% downside play, while TARA20260220P5 provides a safer, longer-term hedge. Key levels to watch: $5.07 (intraday low) and $4.02 (Bollinger lower band). If TARA breaks below $5.07, the put options gain intrinsic value. For bulls, the 30D MA at $5.14 offers a potential bounce point.

Backtest Protara Therapeutics Stock Performance
Below is an interactive event-study module that summarises how TARA’s share price behaved after every trading day that experienced an intraday plunge of 21 % or more (Jan-2022 → present).Key take-aways:1. Frequency & window • 33 qualifying plunge days since Jan-2022 were tested over a 30-day horizon.2. Performance snapshot • Average event return peaks around +5-6 % by day 27 but never achieves statistical significance. • Win-rate hovers near coin-flip (≈45-50 %) across the window.3. Relative value add • Benchmark (buy-and-hold) outperforms the strategy after ~10 days; excess return turns negative by day 30.Interpretation: historically, buying TARA immediately after a -21 % intraday collapse delivered only marginal, non-significant upside and under-performed a passive position after the first fortnight. The pattern offers limited predictive edge.Feel free to drill into the interactive chart for daily curves, drawdowns and event-by-event detail, or let me know if you’d like to refine the trigger threshold / holding window.

TARA’s 20.7% Drop: A Buying Opportunity or a Warning Sign?
Protara’s 20.7% intraday selloff is a liquidity-driven reaction to its $75M offering, but the biotech’s 72% CR rate in TARA-002 trials and $25.00 analyst price target suggest long-term potential. Short-term traders should focus on the $5.07 support and $4.02 Bollinger lower band, while longer-term investors may consider the 200D MA at $3.07 as a critical floor. The sector leader Amgen (AMGN) is down 2.55%, signaling broader caution. Action: Buy TARA20251219P5 for a 5% downside play and monitor the offering’s completion on Dec 8. If TARA closes below $5.07, the bearish thesis strengthens.