Weak On High Volume: Incyte (INCY)
Trade-Ideas LLC identified
(
) as a weak on high relative volume candidate. In addition to specific proprietary factors, Trade-Ideas identified Incyte as such a stock due to the following factors:
- INCY has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $170.1 million.
- INCY has traded 342,298 shares today.
- INCY is trading at 3.35 times the normal volume for the stock at this time of day.
- INCY is trading at a new low 3.02% 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 INCY:
Incyte Corporation, a biopharmaceutical company, focuses on the discovery, development, and commercialization of proprietary therapeutics primarily for oncology. INCY has a PE ratio of 1306. Currently there are 10 analysts that rate Incyte a buy, no analysts rate it a sell, and none rate it a hold.
The average volume for Incyte has been 1.8 million shares per day over the past 30 days. Incyte has a market cap of $21.2 billion and is part of the health care sector and drugs industry. The stock has a beta of 0.10 and a short float of 2.8% with 2.64 days to cover. Shares are up 65% year-to-date as of the close of trading on Monday.
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Analysis:
rates Incyte as a
. The company's strengths can be seen in multiple areas, such as its robust revenue growth, notable return on equity and good cash flow from operations. However, as a counter to these strengths, we also find weaknesses including poor profit margins and generally higher debt management risk.
Highlights from the ratings report include:
- INCY's very impressive revenue growth greatly exceeded the industry average of 5.2%. Since the same quarter one year prior, revenues leaped by 63.7%. Growth in the company's revenue appears to have helped boost the earnings per share.
- In comparison to other companies in the Biotechnology industry and the overall market on the basis of return on equity, INCYTE CORP has underperformed in comparison with the industry average, but has greatly exceeded that of the S&P 500.
- INCYTE CORP 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, INCYTE CORP continued to lose money by earning -$0.32 versus -$0.54 in the prior year. For the next year, the market is expecting a contraction of 34.4% in earnings (-$0.43 versus -$0.32).
- The debt-to-equity ratio is very high at 11.96 and currently higher than the industry average, implying increased risk associated with the management of debt levels within the company. Despite the company's weak debt-to-equity ratio, the company has managed to keep a very strong quick ratio of 3.65, which shows the ability to cover short-term cash needs.
- The gross profit margin for INCYTE CORP is currently extremely low, coming in at 2.38%. Despite the low profit margin, it has increased significantly from the same period last year. Despite the mixed results of the gross profit margin, INCY's net profit margin of 5.70% is significantly lower than the industry average.
- You can view the full Incyte Ratings Report.
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