aTyr Pharma (ATYR) Might Be a UFO!
I saw a large dog and tried to pet it, but it ended up eating my hand instead! Luckily like all humans, it will grow back.
This stock is a little outside what I would normally trade, but it appeared on one of my scanners for the first time and I decided to take a chance since the collateral requirement was incredibly low. I'll discuss that, but first...
What's the Word on the Street?
As I write this, every index except the Dow is up. PPI came in cooler than expected, which boosted the chance of the Federal Reserve cutting interest rates.
The producer price index, which measures input costs across a broad array of goods and services, dropped 0.1% for the month, after a downwardly revised 0.7% increase in July and well off the Dow Jones estimate for a 0.3% rise. On a 12-month basis, the headline PPI saw a 2.6% gain.
The core PPI, which excludes volatile food and energy prices, also was off 0.1% after being expected to climb 0.3% as well. Excluding food, energy and trade, the PPI posted a 0.3% gain and was up 2.8% from a year ago.
Also, Oracle reported earnings last night that showed AI spending is still going strong.
aTyr Pharma (ATYR)
What Is It?
aTyr Pharma, Inc. engages in the discovery and development of medicines based on novel biological pathways. Its product pipeline includes ATYR1923, ATYR2810, NRP2 mAbs, and AARS-1, DARS-1. The company was founded by Paul Schimmel, Xiang-Lei Yang and Bruce Beutler on September 8, 2005 and is headquartered in San Diego, CA. The listed name for ATYR is aTyr Pharma, Inc. Common Stock.
Why Is It a Possible UFO?
Primarily its current share price relative to its fair value, what other option traders expect, and its volatility are the reasons ATYR could be a UFO.
What About Recent News?
There isn't a lot going on for ATYR when checking my normal sources. It's all very bland newswire stuff. The stock was added to the Russell 2000 and 3000 about 10 weeks ago.
What's the Current Price?
ATYR has risen quite a lot in the past year. For 2025 it's been up ~44%, but down in the past 3 months ~2%, down ~6% on the month, down ~8% in the past week and down slightly on the day.
What’s the Fair Value?
I’d first like to emphasize that fair value is subjective. Many analysts at many banks and institutions rate stocks differently and assign fair value in their own unique way. So, what I like to do is take all the recent fair values since the most recent earnings report and average them. In this case…
Since ATYR's most recent earnings report on 08/12/2025, it has received 1 rating, so there's no need to average anything! According to Roger Song at Jefferies, the fair value is $17 with a Buy.
What Do Options Traders Expect?
Calls are trading over equidistant Puts, which means traders think there is a chance to the upside. You can see because… forget about the green columns and focus on the red. Notice how on the right side for the $4 Put it says $2.10, it’s $2.65 for the equidistant Call at $7.
The premium (the credit you receive for executing the trade) is currently less for selling Puts, as opposed to selling Calls. Basically because of that, option traders expect the stock to go up, rather than down.
How About Volatility?
The IV rank (the purple line) for ATYR (stock price in blue) is currently hovering around 94.85, which is extremely high (IV rank goes from 0-100). This makes short strategies (which are what I prefer) much more attractive.
What's the Trade?
My preferred trade is a variation of the wheel without the rolling, AKA cash-secured puts. I typically like to target stocks that offer a dividend and are below fair value.
Why a dividend? If the trade results in assignment and I’m on the hook for X amount of shares, I can at least be satisfied knowing I picked a (hopefully under fair value) company that will pay me a small amount while I run the other side of the trade AKA covered calls.
ATYR does not offer a dividend, but that’s not a dealbreaker!
It’s a fairly low-risk strategy (all options trading is risky!), that has a higher probability of success, but requires a higher amount of collateral.
So if you saw the most recent image above, I already STO (sold to open) 1 contract of the $4 Put for the October 17th expiration. I like to have a DTE (Days To Expiration) that is around ~45 days.
When the trade reaches 50% profit I will buy it back. I don’t like to be greedy and go for more profit, because I would rather not waste my time being in a trade for too long.
What About Alternative Trade Ideas?
- If the collateral requirement is too high, another idea is a put credit spread. You would sell a put at a strike below the current share price and then buy a put at a lower strike than the put you sold. By doing so, you will avoid the collateral requirement of a cash-secured put, but the credit received will be smaller. Also, if the trade goes sideways, you will not be assigned shares so no collecting dividends and running covered calls afterwards.
- Just invest! 1 share or even fractional shares are a way to get a foothold in a stock that you think might increase in value.
Completed Trades
Dino Silvestro
BTC with 55.67% profit
Dino Silvestro
BTC with 55.50% profit
Dino Silvestro
BTC with 50% profit
Wait…Where Are the Candlesticks? And All the Other Indicators?
I know many traders love their candlesticks and a ton of indicators. I prefer simplicity. Candlesticks aren’t necessary unless you’re the kind of trader that wants to try and pick the perfect moment to execute a trade, and even then it’s not a sure thing.
As for indicators, there are a ton. Some of them work sometimes. None are perfect. I don’t want to get bogged down with too many. You’ll drive yourself crazy looking at too many of them, so find a handful you like and stick with those.
Disclosures
- I currently have an open trade with ATYR (as mentioned in this post).
- No trade is a sure thing. There is always risk involved.
- This blog post is not meant to take the place of financial advice, but hopefully acts as a guide for learning or informational purposes.