Sagent Pharmaceuticals (SGNT): Today's Weak On High Volume Stock

Trade-Ideas LLC identified Sagent Pharmaceuticals (SGNT) as a weak on high relative volume candidate
By TheStreet Wire ,

Trade-Ideas LLC identified

Sagent Pharmaceuticals

(

SGNT

) as a weak on high relative volume candidate. In addition to specific proprietary factors, Trade-Ideas identified Sagent Pharmaceuticals as such a stock due to the following factors:

  • SGNT has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $5.2 million.
  • SGNT has traded 51,726 shares today.
  • SGNT is trading at 5.07 times the normal volume for the stock at this time of day.
  • SGNT is trading at a new low 3.27% below yesterday's close.

'Weak on High Relative Volume' stocks are worth watching because major volume moves tend to indicate underlying activity such as material stock news, analyst downgrades, insider selling, selling from 'superinvestors,' or that hedge funds and traders are piling out of a stock ahead of a catalyst. Regardless of the impetus behind the price and volume action, when a stock moves with strength and volume it can indicate the start of a new trend on which early investors can capitalize (or avoid losses by trimming weak positions). In the event of a well-timed trading opportunity, combining technical indicators with fundamental trends and a disciplined trading methodology should help you take the first steps towards investment success.

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More details on SGNT:

Sagent Pharmaceuticals, Inc., a specialty pharmaceutical company, develops, sources, manufactures, and markets pharmaceutical products, principally injectable-based generic equivalents to branded products in North America. SGNT has a PE ratio of 19. Currently there are 4 analysts that rate Sagent Pharmaceuticals a buy, no analysts rate it a sell, and 4 rate it a hold.

The average volume for Sagent Pharmaceuticals has been 374,100 shares per day over the past 30 days. Sagent has a market cap of $549.5 million and is part of the health care sector and drugs industry. The stock has a beta of 1.72 and a short float of 17% with 7.96 days to cover. Shares are down 33% year-to-date as of the close of trading on Monday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Sagent Pharmaceuticals as a

hold

. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures and reasonable valuation levels. However, as a counter to these strengths, we also find weaknesses including unimpressive growth in net income, poor profit margins and weak operating cash flow.

Highlights from the ratings report include:

  • The revenue growth came in higher than the industry average of 3.4%. Since the same quarter one year prior, revenues rose by 11.8%. 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.
  • SGNT's debt-to-equity ratio is very low at 0.01 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Along with the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.37, which illustrates the ability to avoid short-term cash problems.
  • Net operating cash flow has significantly decreased to -$4.69 million or 119.53% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
  • 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 Pharmaceuticals industry. The net income has significantly decreased by 108.3% when compared to the same quarter one year ago, falling from $3.07 million to -$0.26 million.

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