NEW YORK (TheStreet) -- Shares of Lightbridge (LTBR) - Get Lightbridge Corporation Report were falling 18.6% to $1.40 on heavy trading volume Friday, giving back gains the synthetics company saw late Thursday.
About 2.3 million shares of Lightbridge were traded by 12:55 p.m. Friday, well above the company's average trading volume of about 47,000 shares a day.
Lightbridge shares jumped Thursday afternoon after the company announced it was granted a key patent for metallic nuclear fuel design in South Korea. The patent covers the company's multi-lobed metallic fuel rod design and fuel assemblies.
"The South Korean patent is another important milestone in the development of our fuel assembly designs for existing and new build pressurized water reactors," President and CEO Seth Grae said in a statement about the patent.
Grae continued, "Korea represents a significant potential market for Lightbridge metallic fuel with 24 operating pressurized water reactors and an additional 12 reactors either under construction or planned by 2035, according to the most current data compiled by the World Nuclear Association."
TheStreet Ratings team rates LIGHTBRIDGE CORP as a Sell with a ratings score of D-. TheStreet Ratings Team has this to say about their recommendation:
"We rate LIGHTBRIDGE CORP (LTBR) a SELL. This is driven by multiple 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 weak operating cash flow and generally disappointing historical performance in the stock itself."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- Net operating cash flow has decreased to -$0.88 million or 40.44% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
- LTBR's stock share price has done very poorly compared to where it was a year ago: Despite any rallies, the net result is that it is down by 46.62%, which is also worse that the performance of the S&P 500 Index. Investors have so far failed to pay much attention to the earnings improvements the company has managed to achieve over the last quarter. Naturally, the overall market trend is bound to be a significant factor. However, in one sense, the stock's sharp decline last year is a positive for future investors, making it cheaper (in proportion to its earnings over the past year) than most other stocks in its industry. But due to other concerns, we feel the stock is still not a good buy right now.
- The return on equity has improved slightly when compared to the same quarter one year prior. This can be construed as a modest strength in the organization. Compared to other companies in the Professional Services industry and the overall market, LIGHTBRIDGE CORP's return on equity significantly trails that of both the industry average and the S&P 500.
- 38.89% is the gross profit margin for LIGHTBRIDGE CORP which we consider to be strong. Regardless of LTBR's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, LTBR's net profit margin of -223.84% significantly underperformed when compared to the industry average.
- LTBR, with its decline in revenue, underperformed when compared the industry average of 1.2%. Since the same quarter one year prior, revenues fell by 22.4%. The declining revenue has not hurt the company's bottom line, with increasing earnings per share.
- You can view the full analysis from the report here: LTBR Ratings Report