Opko Health (OPK) Stock Declines Ahead of Earnings
NEW YORK (TheStreet) -- Opko Health (OPK) - Get Report stock is down 1.21% to $9.84 in afternoon trading on Monday, before the company is scheduled to release its 2015 third quarter financial results, due after the market close this afternoon.
The company is expected to report a narrower loss and a year-over-year increase in revenue for the quarter ended September 30.
Analysts have estimated a loss of 2 cents per share on $132.99 million in revenue for the latest quarter.
Last year, Opko Health reported a loss of 11 cents per share on $19.8 million in revenue for the quarter ended September 30, 2014.
The Miami-based biopharmaceutical company also operates a diagnostic unit that develops solutions to diagnose, treat and prevent various conditions.
Separately, TheStreet Ratings team rates OPKO HEALTH INC as a Sell with a ratings score of D+. TheStreet Ratings Team has this to say about their recommendation:
We rate OPKO HEALTH INC (OPK) a SELL. This is driven by a few notable weaknesses, which we believe should have a greater impact than any strengths, and could make it more difficult for investors to achieve positive results compared to most of the stocks we cover. The company's weaknesses can be seen in multiple areas, such as its deteriorating net income, disappointing return on equity, weak operating cash flow and feeble growth in its earnings per share.
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- 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 67.8% when compared to the same quarter one year ago, falling from -$25.48 million to -$42.77 million.
- 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 Biotechnology industry and the overall market, OPKO HEALTH 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 -$34.06 million or 119.78% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
- OPKO HEALTH INC's earnings per share declined by 50.0% in the most recent quarter compared to the same quarter a year ago. The company has reported a trend of declining earnings per share over the past two years. However, the consensus estimate suggests that this trend should reverse in the coming year. During the past fiscal year, OPKO HEALTH INC reported poor results of -$0.40 versus -$0.33 in the prior year. This year, the market expects an improvement in earnings (-$0.35 versus -$0.40).
- Looking at where the stock is today compared to one year ago, we find that it is higher, and it has outperformed the rise in the S&P 500 over the same period, despite the company's weak earnings results. Turning our attention to the future direction of the stock, we do not believe this stock offers ample reward opportunity to compensate for the risks, despite the fact that it rose over the past year.
- You can view the full analysis from the report here: OPK
Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of Jim Cramer, TheStreet or any of its contributors.