BridgeBio Options See Heavy Bearish Activity as Stock Drops 6%

Shares of BridgeBio Pharma (NASDAQ: BBIO) declined sharply on Tuesday, accompanied by an unusually large and bearishly skewed options trade. The stock was trading down 6.09% at $67.98 as of 11:53 AM EDT, while options market data revealed a put-to-call ratio of approximately 7.94-to-1, indicating a heavy concentration of bets on a further price decline.

Anatomy of the Trade

The session's activity was dominated by a single, large put spread targeting the October 16, 2026, expiration. The trade involved a near-equal number of contracts on two different strike prices:

• 2,224 contracts of the $65 strike put
• 2,222 contracts of the $55 strike put

Data showed that prior open interest on the $55 strike leg was zero, confirming that this was a newly initiated position. The structure is a classic put spread, which profits if the stock price falls below the higher strike price, with maximum gains realized if it closes below the lower strike at expiration.

Conflicting Volatility Signals

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Despite the surge in put volume, which typically drives up implied volatility (IV), BridgeBio's 3-month IV actually fell 1.08 percentage points to 46.60%. A decrease in IV during heavy put trading can suggest that the spread was sold by a trader, not bought. Selling a put spread is a neutral-to-bullish strategy, representing a bet that the stock will remain above $65.

However, another volatility metric, the 90/110 skew, complicated this interpretation. The skew rose 1.79 percentage points, signaling that demand for out-of-the-money puts is increasing relative to calls. This divergence suggests that while a large trader may have placed a bet on the stock's stability, the broader market is pricing in a greater risk of a significant downturn.

Market Context

Tuesday's sell-off brings BridgeBio's stock price just a few dollars above the $65 strike, a key level defined by the options trade. The stock has fallen approximately 14.86% over the past month, though it remains up 32.10% over the last year, according to Investing.com data.

The activity comes after recent company presentations highlighted an optimistic outlook, including strong market share for its drug Attruby (acoramidis) and a pipeline with $8 billion in peak sales potential. The large options position may reflect a hedge against risks to that outlook, such as commercial adoption hurdles or future competition.