Trade-Ideas: Geron (GERN) Is Today's "Dead Cat Bounce" 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 "dead cat bounce" (down big yesterday but up big today) candidate. In addition to specific proprietary factors, Trade-Ideas identified Geron as such a stock due to the following factors:
- GERN has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $20.3 million.
- GERN has traded 860,011 shares today.
- GERN is up 3.7% today.
- GERN was down 7.4% yesterday.
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More details on GERN:
Geron Corporation, a clinical stage biopharmaceutical company, develops a telomerase inhibitor, imetelstat, to treat hematologic myeloid malignancies. The company was founded in 1990 and is based in Menlo Park, California. Currently there are 2 analysts that rate Geron a buy, no analysts rate it a sell, and 1 rates it a hold.
The average volume for Geron has been 3.1 million shares per day over the past 30 days. Geron has a market cap of $594.3 million and is part of the health care sector and drugs industry. Shares are up 7.7% year-to-date as of the close of trading on Friday.
Analysis:
rates Geron as a
. Among the areas we feel are negative, one of the most important has been a generally disappointing historical performance in the stock itself.
Highlights from the ratings report include:
- GERN has underperformed the S&P 500 Index, declining 15.44% 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.
- The company, on the basis of net income growth from the same quarter one year ago, has underperformed when compared to that of the S&P 500 and greatly underperformed compared to the Biotechnology industry average. The net income increased by 3.6% when compared to the same quarter one year prior, going from -$9.28 million to -$8.95 million.
- The revenue fell significantly faster than the industry average of 35.5%. Since the same quarter one year prior, revenues fell by 20.9%. The declining revenue has not hurt the company's bottom line, with increasing earnings per share.
- GERON CORP has improved earnings per share by 14.3% 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. We feel that this trend should continue. This trend suggests that the performance of the business is improving. During the past fiscal year, GERON CORP continued to lose money by earning -$0.24 versus -$0.29 in the prior year. This year, the market expects an improvement in earnings (-$0.03 versus -$0.24).
- You can view the full Geron Ratings Report.
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