Shares of the immuno-oncology and pain specialist Sorrento Therapeutics (SRNE.Q 7.35%) were down by 15.3% on sky-high volume as of 11:50 a.m. EDT today. Earlier in the day, the biotech's stock had slumped by as much as 20%.
What's behind this double-digit move lower? Oddly enough, Sorrento's stock seems to be tanking without a discernible catalyst today.
Sorrento is no stranger to extreme levels of share price volatility. The stock has popped and dropped several times this year -- often for no reason at all. These kinds of wild swings are fairly typical for small-cap biotechs, especially those in penny stock territory like Sorrento.
The long and short of it is that day traders are more than likely behind these recent price swings in Sorrento's shares, and this situation isn't likely to change until the company's adoptive cell therapy pipeline or pain management assets hit a major milestone. In other words, shareholders should brace themselves for even more volatility in the near term.
On the plus side, Sorrento does sport a fairly broad range of high-value assets in immuno-oncology and pain management. The small-cap biotech could be in a radically different place two to three years from now. Sorrento also happens to be the largest shareholder in the groundbreaking regenerative medicine company Celularity -- a business already valued at roughly $1 billion. Therefore, this latest downturn in Sorrento's stock might present a worthwhile entry point for risk-tolerant investors who are willing to take the long view.