Trade-Ideas LLC identified

Infinity Pharmaceuticals

(

INFI

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

  • INFI has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $7.8 million.
  • INFI has traded 55,009 shares today.
  • INFI is trading at 2.40 times the normal volume for the stock at this time of day.
  • INFI is trading at a new low 4.02% 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 INFI:

Infinity Pharmaceuticals, Inc., a drug discovery and development company, discovers, develops, and delivers medicines to patients with difficult-to-treat diseases. Currently there are 5 analysts that rate Infinity Pharmaceuticals a buy, no analysts rate it a sell, and 1 rates it a hold.

The average volume for Infinity Pharmaceuticals has been 896,600 shares per day over the past 30 days. Infinity has a market cap of $448.5 million and is part of the health care sector and drugs industry. The stock has a beta of 2.04 and a short float of 17.3% with 8.05 days to cover. Shares are down 49.9% year-to-date as of the close of trading on Wednesday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Infinity Pharmaceuticals as a

sell

. The company's weaknesses can be seen in multiple areas, such as its unimpressive growth in net income, weak operating cash flow and generally disappointing historical performance in the stock itself.

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 compared to the Biotechnology industry average, but is greater than that of the S&P 500. The net income has decreased by 1.1% when compared to the same quarter one year ago, dropping from -$38.02 million to -$38.43 million.
  • INFI has underperformed the S&P 500 Index, declining 14.49% 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.
  • Net operating cash flow has declined marginally to -$31.85 million or 6.18% when compared to the same quarter last year. Despite a decrease in cash flow INFINITY PHARMACEUTICALS INC is still fairing well by exceeding its industry average cash flow growth rate of -46.79%.
  • The company's current return on equity greatly increased when compared to its ROE from the same quarter one year prior. This is a signal of significant strength within the corporation. Compared to other companies in the Biotechnology industry and the overall market, INFINITY PHARMACEUTICALS INC's return on equity significantly trails that of both the industry average and the S&P 500.
  • INFINITY PHARMACEUTICALS INC reported flat earnings per share in the most recent quarter. 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, INFINITY PHARMACEUTICALS INC continued to lose money by earning -$0.45 versus -$2.64 in the prior year. For the next year, the market is expecting a contraction of 500.0% in earnings (-$2.70 versus -$0.45).

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