Trade-Ideas LLC identified

Anacor Pharmaceuticals

(

ANAC

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

  • ANAC has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $73.0 million.
  • ANAC has traded 69,335 shares today.
  • ANAC is trading at 2.56 times the normal volume for the stock at this time of day.
  • ANAC is trading at a new low 4.16% 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 ANAC:

TST Recommends

Anacor Pharmaceuticals, Inc., a biopharmaceutical company, focuses on discovering, developing, and commercializing novel small-molecule therapeutics derived from its boron chemistry platform. It markets KERYDIN (tavaborole) topical solution for the treatment of onychomycosis of the toenails. Currently there are 3 analysts that rate Anacor Pharmaceuticals a buy, no analysts rate it a sell, and none rate it a hold.

The average volume for Anacor Pharmaceuticals has been 738,400 shares per day over the past 30 days. Anacor has a market cap of $4.1 billion and is part of the health care sector and drugs industry. The stock has a beta of 1.30 and a short float of 8.8% with 3.85 days to cover. Shares are down 21.8% year-to-date as of the close of trading on Monday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Anacor Pharmaceuticals as a

sell

. The company's weaknesses can be seen in multiple areas, such as its disappointing return on equity and weak operating cash flow.

Highlights from the ratings report include:

  • 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, ANACOR PHARMACEUTICALS 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 -$24.22 million or 292.47% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
  • ANACOR PHARMACEUTICALS INC reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, ANACOR PHARMACEUTICALS INC swung to a loss, reporting -$2.07 versus $1.82 in the prior year. This year, the market expects an improvement in earnings (-$1.27 versus -$2.07).
  • Even though the current debt-to-equity ratio is 1.03, it is still below the industry average, suggesting that this level of debt is acceptable within the Biotechnology industry. Even though the debt-to-equity ratio shows mixed results, the company's quick ratio of 5.48 is very high and demonstrates very strong liquidity.
  • This stock has increased by 181.79% over the past year, outperforming the rise in the S&P 500 Index during the same period. Regarding the future course of this stock, we feel that the risks involved in investing in ANAC do not compensate for any future upside potential, despite the fact that it has seen nice gains over the past 12 months.

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