AstraZeneca (AZN) Stock Rising on FDA Approval of Lung Cancer Drug

AstraZeneca (AZN) stock is up in early afternoon trading on Monday, after the bio-pharmaceutical company announced the FDA's approval of its lung cancer drug.
By Amanda Albright ,

NEW YORK (TheStreet) -- AstraZeneca (AZN) - Get Report stock is soaring by 4.47% to $32.69 on heavy trading volume on Monday afternoon, after the company's lung cancer treatment received regulatory approval.

On Friday, the London-based bio-pharmaceutical company announced that its non-small cell lung cancer treatment was approved by the U.S.Food and Drug Administration.

"We have built on our heritage in this area and acted on the breakthrough clinical evidence to ensure this next-generation medicine reaches patients in record time," CEO Pascal Soriot said in a statement. "As we advance our comprehensive lung cancer portfolio, we have the opportunity to treat greater numbers of patients across all stages of this disease through precision medicines, immunotherapies and novel combinations."

So far today, 7.35 million shares of AstraZeneca have traded, versus its 30-day average of 2.62 million shares. 

Separately, TheStreet Ratings team rates ASTRAZENECA PLC as a Hold with a ratings score of C+. TheStreet Ratings Team has this to say about their recommendation:

We rate ASTRAZENECA PLC (AZN) a HOLD. The primary factors that have impacted our rating are mixed - some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its compelling growth in net income, largely solid financial position with reasonable debt levels by most measures and expanding profit margins. However, as a counter to these strengths, we also find weaknesses including a generally disappointing performance in the stock itself and weak operating cash flow.

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Pharmaceuticals industry. The net income increased by 203.1% when compared to the same quarter one year prior, rising from $254.00 million to $770.00 million.
  • The debt-to-equity ratio is somewhat low, currently at 0.63, and is less than that of the industry average, implying that there has been a relatively successful effort in the management of debt levels.
  • ASTRAZENECA PLC reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, ASTRAZENECA PLC reported lower earnings of $0.49 versus $1.02 in the prior year. This year, the market expects an improvement in earnings ($2.10 versus $0.49).
  • Net operating cash flow has decreased to $1,745.00 million or 10.51% when compared to the same quarter last year. In conjunction, when comparing current results to the industry average, ASTRAZENECA PLC has marginally lower results.
  • AZN has underperformed the S&P 500 Index, declining 16.92% from its price level of one year ago. Looking ahead, we do not see anything in this company's numbers that would change the one-year trend. It was down over the last twelve months; and it could be down again in the next twelve. Naturally, a bull or bear market could sway the movement of this stock.
  • You can view the full analysis from the report here: AZN

Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of Jim Cramer, TheStreet or any of its contributors.

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