While Everyone Was Selling, I Initiated a New Position in This Mid-Cap Biotech
I made exactly one trade Friday — and I went to Denmark to do it.
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It was a very eventful close to the first trading week in June. First, the good news. The May BLS jobs report came in much stronger than expected and the prior two months’ numbers were revised up encouragingly. This followed a surge in job openings for April that were disclosed earlier in the week. While the majority of jobs created in May came from healthcare and local government, I will not quibble.
A hot jobs report caused the yield on the 10-Year Treasury to back up past the 4.5% level as it pushed any further rate reductions out further on the horizon. The markets were in full risk-off mode on Friday. Bitcoin dropped below $60,000 for the first time since 2024. The Nasdaq sold off by more than 4% — the tech-heavy index’s worst daily performance since the tariff tantrum back in early April of last year. The Philadelphia Semiconductor Index (SOX) sold off by 10% after being on fire for months.
Whether Friday’s trading action was a hiccup, a long overdue bout of profit taking, the start of heavy-duty sector rotation, investors freeing up capital for the huge Space Exploration Technologies (SPCX) IPO next week, or the start of a more substantial pullback in an overbought market is an unknown. We will find out together in the weeks ahead.
I made exactly one trade late on Friday, as I put a considerable amount of dry powder within my portfolio to work incrementally during the pullback to close the week. That’s what we’ll talk about here.
I established an initial position in Denmark-headquartered Ascendis Pharma A/S (ASND), a company focused on developing and commercializing therapies treating rare endocrine diseases off its proprietary TransCon platform. This technology produces products that enhance drug delivery and have sustained release characteristics.
Ascendis has three products on the market. The key one is its once-daily injectable hormone therapy Yorvipath. This treatment was approved for hypoparathyroidism in adults in Europe in late 2023 and in the United States in the summer of 2024.
The early results from the marketing rollout of this therapy powered a nearly 200% rally in the stock since late 2023 into April of this year. Since then the stock has fallen back just over 15%, providing a solid entry point.
Sales for Yorvipath came in at over $550 million in 2025. Sales in Q1 were over $228 million and the therapy is on the way to blockbuster status even as there is competition in the space and late-stage candidates from other concerns in development.
Ascendis is on its way to make over $13 a share in profits in 2026, according to estimates. Of that, $3 a share will be from a one-time sale of a priority review voucher. Earnings are projected to drop to a still respectful $11.00 a share in 2027.
Sales are estimated to rise sharply this year and by a mid-forties percentage in 2027 to over $2.2 billion. Management has a stated goal of hitting $5 billion in annual revenues by 2030. With the recent pullback, Ascendis sports an approximate market cap of $13 billion, with the shares trading around $210.
Leadership used the company’s growing cash flow and cash on hand to retire all of Ascendis’s convertible debt in May after boosting its stock buyback authorization in January. There have been some small insider purchases in the shares over the past two weeks as well.
Here is how I established a position in the shares on Friday’s market selloff.
Option Strategy
Here is how one can establish a position in ASND using a covered call strategy. As a reminder, covered call orders involve buying an equity and simultaneously selling just out of the money call strikes against the new position.
Selecting the January $200 call strikes, fashion a covered call order with a net debit in the $174.00 to $175.00 a share range (net stock price – option premium).
This strategy delivers downside protection of 17% across the trade expiration. It also provides upside potential of nearly 15% over the option duration even if the stock trades down 5% over the option duration.
At the time of publication, Jensen was long ASND.
