Sarepta Surges 11.62%—What’s Brewing Behind the FDA Drama and Earnings Hype?

Summary
• Sarepta (SRPT) rockets 11.62% to $17.67, hitting an intraday high of $19.24 and low of $17.13.
• The stock faces FDA regulatory scrutiny over its gene therapy ELEVIDYS and awaits Q2 earnings results on July 30.
• Analysts expect a 1242.9% YoY EPS surge to $0.94, but recent estimate revisions and legal risks cloud the outlook.
• High volatility is evident, with 24.77% turnover and a -0.97 PE ratio, signaling mixed sentiment.
Today’s explosive move in Sarepta reflects a volatile mix of regulatory uncertainty, earnings anticipation, and operational risks. The stock’s sharp rebound from $17.13 to $19.24 highlights investor speculation amid the FDA’s black box warning and unresolved lawsuits. Traders are now parsing whether the earnings beat potential can outweigh the near-term headwinds.

FDA Scrutiny and Earnings Outlook Drive Volatility
Sarepta’s 11.62% rally is fueled by a collision of regulatory developments and earnings expectations. The FDA’s recent decision to resume ELEVIDYS shipments for ambulatory Duchenne patients, following a temporary halt due to safety concerns, has reignited speculative interest. However, the company remains under a black box warning for acute liver injury and faces ongoing securities lawsuits. Meanwhile, Wall Street anticipates a 1242.9% YoY EPS jump to $0.94 and $529.54 million in revenue for Q2. The Zacks Earnings ESP of +14.74% suggests analysts have recently upgraded their estimates, but the Zacks Rank 4 (Strong Sell) complicates the narrative. This tug-of-war between regulatory optimism and legal/operational risks has created a volatile trading environment.

Options Playbook: Capitalizing on Volatility and Earnings Catalysts
• 200-day MA: 82.08 (well below current price)
• RSI: 41.79 (oversold territory)
• MACD: -3.43 vs. Signal Line -3.88 (bullish divergence)
• Bollinger Bands: 22.32 (upper), 16.69 (middle), 11.05 (lower) — price near midband
• K-line pattern: Short-term bullish trend, long-term bearish
• Sector Leader (Amgen): -0.428% intraday

With SRPT trading near its 52-week low of $10.42 and a -0.97 PE ratio, the stock is in speculative mode. Key levels to watch: the 200-day MA at $82.08 (far out of reach), the Bollinger middle band at $16.69, and the 30D support/resistance range of $18.15–$18.36. The RSI at 41.79 suggests oversold conditions, but the negative PE ratio underscores fundamental challenges. Aggressive traders may consider the options chain for directional bets.

Top Options Contracts:
• SRPT20250808C18: Call option, strike $18, expiry 2025-08-08
- IV: 155.23% (high volatility)
- Leverage Ratio: 9.95%
- Delta: 0.545 (moderate sensitivity)
- Theta: -0.1258 (rapid time decay)
- Gamma: 0.086 (high sensitivity to price moves)
- Turnover: $260,043 (liquid)
- Price Change Ratio: 101.25% (strong momentum)
- Why it stands out: High IV and gamma make this call ideal for a 5% upside move to $18.55. Projected payoff: max(0, 18.55 - 18) = $0.55/share, a 30.5% return on strike.

• SRPT20250815C17.5: Call option, strike $17.5, expiry 2025-08-15
- IV: 119.78% (moderate volatility)
- Leverage Ratio: 8.74%
- Delta: 0.5896 (moderate sensitivity)
- Theta: -0.0747 (slow decay)
- Gamma: 0.084 (strong responsiveness)
- Turnover: $68,632 (liquid)
- Price Change Ratio: 56.49% (solid momentum)
- Why it stands out: Lower IV and longer expiry (8 days) offer a buffer for the August 15 expiration. A 5% move to $18.54 would yield max(0, 18.54 - 17.5) = $1.04/share, a 59.4% return on strike.

Hook: If SRPT holds above $17.13 and breaks the 30D support at $18.15, SRPT20250808C18 offers a high-gamma, high-IV play for a short-term pop. Aggressive bulls may also consider SRPT20250815C17.5 as a longer-dated bet into the earnings event.

Backtest Sarepta Stock Performance
The backtest of SRPT's performance after an intraday surge of 12% shows poor short-term results, with the 3-Day win rate at 50.26%, the 10-Day win rate at 49.22%, and the 30-Day win rate at 45.22%. The returns over these periods are negative, with a 3-Day return of -0.43%, a 10-Day return of -1.73%, and a 30-Day return of -3.99%. The maximum return during the backtest was -0.11%, which occurred on day 0, indicating that the strategy consistently underperformed even in the immediate aftermath of the intraday surge.

Act Fast: Earnings and FDA Moves Could Define SRPT’s Next 30 Days
Sarepta’s 11.62% surge is a high-stakes gamble between regulatory optimism and operational risks. The FDA’s resumption of ELEVIDYS shipments offers a temporary reprieve, but unresolved lawsuits and safety concerns linger. With Q2 earnings due soon and a Zacks Earnings ESP of +14.74%, the market is pricing in a potential beat, though the Zacks Rank 4 (Strong Sell) cautions against complacency. Traders should monitor the $18.15 support level and the 30D resistance at $18.36. If the stock breaks above $19.24, the Bollinger upper band at $22.32 becomes a distant target. Action: Buy SRPT20250808C18 for a 5% upside play or hold SRPT20250815C17.5 into the earnings window. Note the sector leader Amgen (AMGN) is down -0.428%, signaling caution in biotech. Watch for a breakdown below $17.13 or a regulatory reversal to pivot strategies.