Trade-Ideas LLC identified

Pacira Pharmaceuticals

(

PCRX

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

  • PCRX has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $22.1 million.
  • PCRX has traded 122,985 shares today.
  • PCRX is trading at 2.86 times the normal volume for the stock at this time of day.
  • PCRX is trading at a new high 3.14% 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 PCRX:

Pacira Pharmaceuticals, Inc., a specialty pharmaceutical company, develops, commercializes, and manufactures proprietary pharmaceutical products primarily for use in hospitals and ambulatory surgery centers in the United States. PCRX has a PE ratio of 38. Currently there are 6 analysts that rate Pacira Pharmaceuticals a buy, no analysts rate it a sell, and 2 rate it a hold.

The average volume for Pacira Pharmaceuticals has been 949,200 shares per day over the past 30 days. Pacira has a market cap of $1.3 billion and is part of the health care sector and drugs industry. The stock has a beta of 1.98 and a short float of 18.5% with 9.20 days to cover. Shares are down 53.5% year-to-date as of the close of trading on Tuesday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Pacira Pharmaceuticals as a

sell

. The company's weaknesses can be seen in multiple areas, such as its deteriorating net income, disappointing return on equity, 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 when compared to that of the S&P 500 and the Pharmaceuticals industry. The net income has significantly decreased by 405.9% when compared to the same quarter one year ago, falling from $1.26 million to -$3.85 million.
  • The company's current return on equity has slightly decreased from the same quarter one year prior. This implies a minor weakness in the organization. Compared to other companies in the Pharmaceuticals industry and the overall market, PACIRA 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 -$3.12 million or 733.06% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
  • Despite any intermediate fluctuations, we have only bad news to report on this stock's performance over the last year: it has tumbled by 46.96%, worse than the S&P 500's performance. Consistent with the plunge in the stock price, the company's earnings per share are down 433.33% compared to the year-earlier 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 gross profit margin for PACIRA PHARMACEUTICALS INC is currently very high, coming in at 73.86%. Regardless of PCRX's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, PCRX's net profit margin of -5.88% significantly underperformed when compared to the industry average.

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