3 Stocks Reiterated As A Sell: FCX, ICPT, ACAD
Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.
NEW YORK (TheStreet) -- TheStreet Ratings team reiterated 3 stocks with a sell rating on Thursday based on 32 different data factors including general market action, fundamental analysis and technical indicators. The in-depth analysis of these ratings decisions goes as follows:
Freeport-McMoRan Inc:
(NYSE:
) has been reiterated by TheStreet Ratings as a sell with a ratings score of D+. According to TheStreet Ratings team: The company's weaknesses can be seen in multiple areas, such as its deteriorating net income, generally high debt management risk, disappointing return on equity, weak operating cash flow and generally disappointing historical performance in the stock itself.
Highlights from the ratings report include:
- The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Metals & Mining industry. The net income has significantly decreased by 503.4% when compared to the same quarter one year ago, falling from $707.00 million to -$2,852.00 million.
- The debt-to-equity ratio of 1.04 is relatively high when compared with the industry average, suggesting a need for better debt level management. To add to this, FCX has a quick ratio of 0.59, this demonstrates the lack of ability of the company to cover short-term liquidity needs.
- Return on equity has greatly decreased when compared to its ROE from the same quarter one year prior. This is a signal of major weakness within the corporation. Compared to other companies in the Metals & Mining industry and the overall market on the basis of return on equity, FREEPORT-MCMORAN INC underperformed against that of the industry average and is significantly less than that of the S&P 500.
- Net operating cash flow has significantly decreased to $1,118.00 million or 53.33% when compared to the same quarter last year. Despite a decrease in cash flow of 53.33%, FREEPORT-MCMORAN INC is in line with the industry average cash flow growth rate of -57.49%.
- Despite any intermediate fluctuations, we have only bad news to report on this stock's performance over the last year: it has tumbled by 40.47%, worse than the S&P 500's performance. Consistent with the plunge in the stock price, the company's earnings per share are down 504.41% compared to the year-earlier quarter. Naturally, the overall market trend is bound to be a significant factor. However, in one sense, the stock's sharp decline last year is a positive for future investors, making it cheaper (in proportion to its earnings over the past year) than most other stocks in its industry. But due to other concerns, we feel the stock is still not a good buy right now.
- You can view the full analysis from the report here: Freeport-McMoRan Ratings Report
Freeport-McMoRan Inc., a natural resource company, engages in the acquisition of mineral assets, and oil and natural gas resources. It primarily explores for copper, gold, molybdenum, cobalt, silver, and other metals, as well as oil and gas. Freeport-McMoRan has a market cap of $19.6 billion and is part of the basic materials sector and metals & mining industry. Shares are down 19.5% year-to-date as of the close of trading on Wednesday.
Intercept Pharmaceuticals Inc:
(Nasdaq:
) has been reiterated by TheStreet Ratings as a sell with a ratings score of D. According to TheStreet Ratings team: The company's weaknesses can be seen in multiple areas, such as its deteriorating net income, disappointing return on equity, weak operating cash flow, feeble growth in its earnings per share and generally disappointing historical performance in the stock itself.
Highlights from the ratings report include:
- The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Biotechnology industry. The net income has decreased by 12.9% when compared to the same quarter one year ago, dropping from -$31.74 million to -$35.84 million.
- Current return on equity is lower than its ROE from the same quarter one year prior. This is a clear sign of weakness within the company. Compared to other companies in the Biotechnology industry and the overall market, INTERCEPT PHARMA INC's return on equity significantly trails that of both the industry average and the S&P 500.
- Net operating cash flow has significantly decreased to -$23.87 million or 270.77% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
- INTERCEPT PHARMA INC' earnings per share from the most recent quarter came in slightly below the year earlier quarter. Earnings per share have declined over the last year. We anticipate that this should continue in the coming year. During the past fiscal year, INTERCEPT PHARMA INC reported poor results of -$3.70 versus -$2.28 in the prior year. For the next year, the market is expecting a contraction of 131.1% in earnings (-$8.55 versus -$3.70).
- Looking at the price performance of ICPT's shares over the past 12 months, there is not much good news to report: the stock is down 39.08%, and it has underformed the S&P 500 Index. In addition, the company's earnings per share are lower today than the year-earlier quarter. Naturally, the overall market trend is bound to be a significant factor. However, in one sense, the stock's sharp decline last year is a positive for future investors, making it cheaper (in proportion to its earnings over the past year) than most other stocks in its industry. But due to other concerns, we feel the stock is still not a good buy right now.
- You can view the full analysis from the report here: Intercept Ratings Report
Intercept Pharmaceuticals, Inc., a development stage biopharmaceutical company, focuses on the development and commercialization of novel therapeutics to treat chronic liver and intestinal diseases utilizing its proprietary bile acid chemistry. Intercept has a market cap of $6.1 billion and is part of the health care sector and drugs industry. Shares are up 83.5% year-to-date as of the close of trading on Wednesday.
ACADIA Pharmaceuticals Inc:
(Nasdaq:
) has been reiterated by TheStreet Ratings as a sell with a ratings score of D. According to TheStreet Ratings team: The company's weaknesses can be seen in multiple areas, such as its feeble growth in its earnings per share, deteriorating net income and disappointing return on equity.
Highlights from the ratings report include:
- ACADIA PHARMACEUTICALS INC has experienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from the same quarter a year ago. Earnings per share have declined over the last two years. We anticipate that this should continue in the coming year. During the past fiscal year, ACADIA PHARMACEUTICALS INC reported poor results of -$0.94 versus -$0.44 in the prior year. For the next year, the market is expecting a contraction of 2.1% in earnings (-$0.96 versus -$0.94).
- The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Biotechnology industry. The net income has significantly decreased by 135.4% when compared to the same quarter one year ago, falling from -$12.05 million to -$28.37 million.
- Current return on equity is lower than its ROE from the same quarter one year prior. This is a clear sign of weakness within the company. Compared to other companies in the Biotechnology industry and the overall market, ACADIA PHARMACEUTICALS INC's return on equity significantly trails that of both the industry average and the S&P 500.
- Compared to its closing price of one year ago, ACAD's share price has jumped by 37.51%, exceeding the performance of the broader market during that same time frame. Regarding the future course of this stock, we feel that the risks involved in investing in ACAD do not compensate for any future upside potential, despite the fact that it has seen nice gains over the past 12 months.
- Despite its growing revenue, the company underperformed as compared with the industry average of 35.5%. Since the same quarter one year prior, revenues rose by 29.7%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
- You can view the full analysis from the report here: ACADIA Ratings Report
ACADIA Pharmaceuticals Inc., a biopharmaceutical company, focuses on the development and commercialization of small molecule drugs that address unmet medical needs in neurological and related central nervous system disorders. ACADIA has a market cap of $4.6 billion and is part of the health care sector and drugs industry. Shares are up 41% year-to-date as of the close of trading on Wednesday.
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