Strong On High Volume: Sangamo BioSciences (SGMO)
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 strong on high relative volume candidate. In addition to specific proprietary factors, Trade-Ideas identified Sangamo BioSciences as such a stock due to the following factors:
- SGMO has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $15.2 million.
- SGMO has traded 143,241 shares today.
- SGMO is trading at 3.45 times the normal volume for the stock at this time of day.
- SGMO is trading at a new high 3.09% above yesterday's close.
'Strong on High Relative Volume' stocks are worth watching because major volume moves tend to indicate underlying activity such as M&A events, material stock news, analyst upgrades, insider buying, buying from 'superinvestors,' or that hedge funds and momentum traders are piling into 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. 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 SGMO:
Sangamo BioSciences, Inc., a clinical stage biopharmaceutical company, focuses on the research, development, and commercialization of zinc finger DNA-binding proteins (ZFPs) for gene regulation and gene modification in the United States. Currently there are 4 analysts that rate Sangamo BioSciences a buy, no analysts rate it a sell, and none rate it a hold.
The average volume for Sangamo BioSciences has been 1.0 million shares per day over the past 30 days. Sangamo BioSciences has a market cap of $1.2 billion and is part of the health care sector and drugs industry. Shares are up 10.6% year-to-date as of the close of trading on Friday.
Analysis:
rates Sangamo BioSciences as a
. The company's strengths can be seen in multiple areas, such as its robust revenue growth, impressive record of earnings per share growth and increase in net income. However, as a counter to these strengths, we find that the stock has had a generally disappointing performance in the past year.
Highlights from the ratings report include:
- SGMO's very impressive revenue growth greatly exceeded the industry average of 36.4%. Since the same quarter one year prior, revenues leaped by 117.7%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
- SANGAMO BIOSCIENCES INC reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. However, we anticipate underperformance relative to this pattern in the coming year. During the past fiscal year, SANGAMO BIOSCIENCES INC continued to lose money by earning -$0.39 versus -$0.47 in the prior year. For the next year, the market is expecting a contraction of 48.7% in earnings (-$0.58 versus -$0.39).
- The company, on the basis of net income growth from the same quarter one year ago, has significantly underperformed compared to the Biotechnology industry average, but is greater than that of the S&P 500. The net income increased by 47.0% when compared to the same quarter one year prior, rising from -$8.14 million to -$4.32 million.
- Current return on equity exceeded its ROE from the same quarter one year prior. This is a clear sign of strength within the company. Compared to other companies in the Biotechnology industry and the overall market, SANGAMO BIOSCIENCES INC's return on equity significantly trails that of both the industry average and the S&P 500.
- SGMO has underperformed the S&P 500 Index, declining 11.62% from its price level of one year ago. The fact that the stock is now selling for less than others in its industry in relation to its current earnings is not reason enough to justify a buy rating at this time.
- You can view the full Sangamo BioSciences Ratings Report.
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