Author: Bret Jensen

I am returning to the biotech sector for this weekend’s covered-call trade idea. And I am teeing up a situation I ordinarily wouldn’t touch. And I am targeting a company that will not be profitable for at least a few years. 

However, this selection is sitting on a massive cash hoard. With covered-call orders, I bring my potential entry point down to the net cash on the balance sheet.

The name in question is firm called BioNTech SE ($BNTX), which has an approximate market cap of roughly $26 billion. This Germany-headquartered commercial stage biopharma concern is focused on the development of immunotherapies and vaccines to treat cancer and infectious diseases. 

The equity was one of the hottest stocks in the market during the COVID pandemic and nearly reached the $400 level in the summer of 2021. Since then, the shares have given back over 70% of their valuation. The company developed and distributed 5 billion COVID vaccine shots based on MRNA technology during the pandemic in conjunction with Pfizer ($PFE). 

That stream of revenue has fallen off a cliff since its peak as fears around catching the coronavirus dissipated. The company generated not quite $3.3 billion in sales in FY2025 and that is projected to fall to $2 billion this fiscal year. The flurry of spending during COVID did allow BioNTech SE to build a huge cash hoard that currently stands around $19 billion. This spring, the company laid off 1,600 employees that will allow the firm to save just over $550 million.

This lucre has allowed the company to develop a broad pipeline of drug candidates as BioNTech to transform back to its roots as a cancer drug developer. These efforts include six mid-to-late-stage clinical programs covering about 33 Phase 2 and Phase 3 trials. 

BioNTech’s primary development asset is a bispecific antibody targeting both PD-L1 and VEGF-A called Pumitamig. Management believes this can become a “backbone” cancer therapy across multiple solid tumor types. The company has over 30 trials ongoing around evaluating Pumitamig both as a monotherapy and as part of a combination therapy and has pivotal trials ongoing to treat gastric, colorectal, triple negative breast (TNBC), non-small cell lung (NSCLC) and SCLC cancers.

By utilizing the covered-call strategy highlighted below, I can bring my potential entry point into BNTX right at its current cash. It is like getting a free square on the company’s developmental efforts. Even if the stock declines in the low teens over the option duration, I pick up a solid return on the trade without ever taking a straight equity holding.

Option Strategy

Here is how one can initiate a position in BNTX utilizing a covered call strategy: Selecting the May $90 call strikes, fashion a covered-call order with a net debit in the $78.00 to $79.00 a share range (net stock price – option premium).

Liquidity is solid with the options against this equity. This strategy provides downside protection of 24% over the trade’s duration. This strategy also provides nearly 15% return potential, even if the stock trades down 13% over its option duration.

At the time of publication, Jensen was long BNTX and PFE.