Endo International (ENDP) Is Today's Water-Logged And Getting Wetter Stock
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.
Trade-Ideas LLC identified
(
) as a "water-logged and getting wetter" (weak stocks crossing below support with today's range greater than 200%) candidate. In addition to specific proprietary factors, Trade-Ideas identified Endo International as such a stock due to the following factors:
- ENDP has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $213.9 million.
- ENDP has traded 9.3 million shares today.
- ENDP traded in a range 270.2% of the normal price range with a price range of $6.72.
- ENDP traded below its daily resistance level (quality: 4 days, meaning that the stock is crossing a resistance level set by the last 4 calendar days. The resistance price is defined by the Price - $0.01 at the time of the signal).
Stocks matching the 'Water-Logged and Getting Wetter' criteria are worthwhile stocks to watch for a variety of factors including historical back testing and volatility. Trade-Ideas targets these opportunities because the stock is exhibiting an unusual behavior while displaying negative price action. In this case, the stock crossed an important inflection point; namely, "support" while at the same time the range of the stock's movement in price is twice its normal size. This large range foreshadows a possible continuation as the stock moves lower.
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More details on ENDP:
Endo International plc, a specialty healthcare company, develops, manufactures, markets, and distributes branded pharmaceutical and generic products, and medical devices worldwide. Currently there are 11 analysts that rate Endo International a buy, no analysts rate it a sell, and 5 rate it a hold.
The average volume for Endo International has been 2.8 million shares per day over the past 30 days. Endo International has a market cap of $15.9 billion and is part of the health care sector and drugs industry. The stock has a beta of 1.33 and a short float of 6.9% with 4.20 days to cover. Shares are up 23.4% year-to-date as of the close of trading on Tuesday.
Analysis:
rates Endo International as a
. The company's strengths can be seen in multiple areas, such as its revenue growth, solid stock price performance and increase in net income. However, as a counter to these strengths, we find that the company has favored debt over equity in the management of its balance sheet.
Highlights from the ratings report include:
- The revenue growth greatly exceeded the industry average of 10.4%. Since the same quarter one year prior, revenues rose by 36.8%. Growth in the company's revenue appears to have helped boost the earnings per share.
- Compared to where it was a year ago today, the stock is now trading at a higher level, reflecting both the market's overall trend during that period and the fact that the company's earnings growth has been robust. Despite the fact that it has already risen in the past year, there is currently no conclusive evidence that warrants the purchase or sale of this stock.
- ENDO INTERNATIONAL 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, ENDO INTERNATIONAL PLC reported poor results of -$5.28 versus -$4.67 in the prior year. This year, the market expects an improvement in earnings ($4.45 versus -$5.28).
- The company's current return on equity greatly increased when compared to its ROE from the same quarter one year prior. This is a signal of significant strength within the corporation. Compared to other companies in the Pharmaceuticals industry and the overall market, ENDO INTERNATIONAL PLC's return on equity significantly trails that of both the industry average and the S&P 500.
- Currently the debt-to-equity ratio of 1.86 is quite high overall and when compared to the industry average, suggesting that the current management of debt levels should be re-evaluated. Along with the unfavorable debt-to-equity ratio, ENDP maintains a poor quick ratio of 0.72, which illustrates the inability to avoid short-term cash problems.
- You can view the full Endo International Ratings Report.
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