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

Peregrine Pharmaceuticals

(

PPHM

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

  • PPHM has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $3.2 million.
  • PPHM has traded 395,114 shares today.
  • PPHM is trading at 5.46 times the normal volume for the stock at this time of day.
  • PPHM is trading at a new low 6.13% 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 PPHM:

Peregrine Pharmaceuticals, Inc., a biopharmaceutical company, is engaged in the research and development of novel monoclonal antibodies for the treatment and diagnosis of cancer in the United States. Currently there are 2 analysts that rate Peregrine Pharmaceuticals a buy, no analysts rate it a sell, and none rate it a hold.

The average volume for Peregrine Pharmaceuticals has been 1.1 million shares per day over the past 30 days. Peregrine has a market cap of $285.9 million and is part of the health care sector and drugs industry. The stock has a beta of 0.49 and a short float of 6.4% with 5.48 days to cover. Shares are up 17.3% year-to-date as of the close of trading on Friday.

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 Peregrine Pharmaceuticals as a

sell

. The company's weaknesses can be seen in multiple areas, such as its deteriorating net income, weak operating cash flow, disappointing return on equity, generally disappointing historical performance in the stock itself 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 55.3% when compared to the same quarter one year ago, falling from -$7.79 million to -$12.10 million.
  • Net operating cash flow has significantly decreased to -$11.51 million or 109.84% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
  • The company's current return on equity has remained constant since the same quarter one year prior. Compared to other companies in the Biotechnology industry and the overall market, PEREGRINE PHARMACEUTICLS INC's return on equity significantly trails that of both the industry average and the S&P 500.
  • Despite any intermediate fluctuations, we have only bad news to report on this stock's performance over the last year: it has tumbled by 44.33%, worse than the S&P 500's performance. Consistent with the plunge in the stock price, the company's earnings per share are down 40.00% 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.
  • PEREGRINE PHARMACEUTICLS INC's earnings per share declined by 40.0% 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, PEREGRINE PHARMACEUTICLS INC continued to lose money by earning -$0.22 versus -$0.25 in the prior year. For the next year, the market is expecting a contraction of 36.4% in earnings (-$0.30 versus -$0.22).

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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