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

Incyte

(

INCY

) as a strong 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 $73.8 million.
  • INCY has traded 149,853 shares today.
  • INCY is trading at 4.63 times the normal volume for the stock at this time of day.
  • INCY is trading at a new high 7.12% 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 INCY:

TheStreet Recommends

Incyte Corporation, a biopharmaceutical company, focuses on the discovery, development, and commercialization of proprietary small molecule drugs primarily for oncology and inflammation. Currently there are 11 analysts that rate Incyte a buy, no analysts rate it a sell, and 1 rates it a hold.

The average volume for Incyte has been 941,100 shares per day over the past 30 days. Incyte has a market cap of $9.8 billion and is part of the health care sector and drugs industry. The stock has a beta of -0.13 and a short float of 8.8% with 8.06 days to cover. Shares are up 14.3% year-to-date as of the close of trading on Wednesday.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Incyte as a

sell

. The company's weaknesses can be seen in multiple areas, such as its deteriorating net income, weak operating cash flow and feeble growth in its earnings per share.

Highlights from the ratings report include:

  • The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Biotechnology industry. The net income has significantly decreased by 1334.2% when compared to the same quarter one year ago, falling from -$2.57 million to -$36.87 million.
  • Net operating cash flow has significantly decreased to -$14.56 million or 280.13% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
  • INCYTE CORP has experienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from the same quarter a year ago. The company has reported a trend of declining earnings per share over the past year. However, the consensus estimate suggests that this trend should reverse in the coming year. During the past fiscal year, INCYTE CORP reported poor results of -$0.54 versus -$0.36 in the prior year. This year, the market expects an improvement in earnings (-$0.40 versus -$0.54).
  • The revenue fell significantly faster than the industry average of 44.2%. Since the same quarter one year prior, revenues slightly dropped by 2.0%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
  • Compared to its closing price of one year ago, INCY's share price has jumped by 41.18%, exceeding the performance of the broader market during that same time frame. Regarding the future course of this stock, we feel that the risks involved in investing in INCY do not compensate for any future upside potential, despite the fact that it has seen nice gains over the past 12 months.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

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