NEW YORK (TheStreet) -- Arrowhead Research (ARWR) - Get Report stock is rising by 0.70% to $4.72 on heavy trading volume on Monday afternoon, after the company said one of its drugs could produce "deep and durable reductions" of Hepatitis B antigens and DNA.
The Pasadena, CA-based bio-pharmaceutical company announced that its clinical program and a nonclinical study in chimpanzees showed substantial effects in treating the chronic liver infection hepatitis B (HBV).
"Both of these studies show that ARC-520 can produce deep and durable knockdown of HBV viral antigens," CEO Christopher Anzalone said in a statement. "These data give us additional confidence in the program as we move forward with multiple-dose and combination studies of ARC-520, that we hope will lead to host immune reconstitution, HBsAg seroclearance, and functional cure."
So far today, 1.53 million shares of Arrowhead have traded, versus its 30-day average of 1.18 million shares.
Separately, TheStreet Ratings team rates ARROWHEAD RESEARCH CORP as a Sell with a ratings score of D. TheStreet Ratings Team has this to say about their recommendation:
We rate ARROWHEAD RESEARCH CORP (ARWR) a SELL. This is driven by a few notable weaknesses, which we believe should have a greater impact than any strengths, and could make it more difficult for investors to achieve positive results compared to most of the stocks we cover. The company's weaknesses can be seen in multiple areas, such as its deteriorating net income, disappointing return on equity, weak operating cash flow, generally disappointing historical performance in the stock itself and feeble growth in its earnings per share.
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- The company, on the basis of change in net income 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 has significantly decreased by 37.0% when compared to the same quarter one year ago, falling from -$11.63 million to -$15.94 million.
- 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, ARROWHEAD RESEARCH CORP's return on equity significantly trails that of both the industry average and the S&P 500.
- Net operating cash flow has decreased to -$13.12 million or 34.17% when compared to the same quarter last year. In addition, when comparing the cash generation rate to the industry average, the firm's growth is significantly lower.
- Reflecting the weaknesses we have cited, including the decline in the company's earnings per share, ARWR has underperformed the S&P 500 Index, declining 15.78% 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.
- ARROWHEAD RESEARCH CORP's earnings per share declined by 22.7% in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. We feel it is likely to report a decline in earnings in the coming year. During the past fiscal year, ARROWHEAD RESEARCH CORP continued to lose money by earning -$1.23 versus -$1.32 in the prior year. For the next year, the market is expecting a contraction of 22.8% in earnings (-$1.51 versus -$1.23).
- You can view the full analysis from the report here: ARWR
Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of Jim Cramer, TheStreet or any of its contributors.