NEW YORK (TheStreet) -- Pluristem Therapeutics (PSTI) - Get Report stock is climbing by 18.08% to $1.17 on heavy trading volume on Thursday, after the FDA granted an orphan drug designation to one of the company's treatments.
The bio-therapeutics company announced on Thursday that its PLX-PAD cell therapy treatment received the special status from the FDA for the treatment of severe preeclampsia. Orphan drug designations are given to products that treat rare diseases, according to the FDA.
Preeclampsia is a pregnancy complication that causes high blood pressure, according to Pluristem. Severe preeclampsia, which occurs in about 1% of pregnancies in Western countries, is the leading cause of premature births, stillbirths and maternal deaths.
"Attainment of Orphan Drug Designation for our cells in severe preeclampsia exemplifies our global strategy of bringing cell therapies to patients through accelerated approval pathways," CEO Zami Aberman said in a statement on Thursday. "We are encouraged by the U.S. FDA designation that demonstrates Pluristem's commitment to the program and the potential promise it holds to address a serious, unmet medical need faced by pregnant women every year."
Based in Haifa, Israel, Pluristem is a bio-therapeutics company develops treatments for cardiovascular, orthopedic, pulmonary, hematological and women's health diseases.
So far today, 1.47 million shares of Pluristem have traded, versus its 30-day average of about 430,000 shares.
Separately, recently, TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this articles's author. TheStreet Ratings has this to say about the recommendation:
We rate PLURISTEM THERAPEUTICS INC as a Sell with a ratings score of D. This is driven by several 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 declined marginally to -$3.77 million or 9.02% when compared to the same quarter last year. In conjunction, when comparing current results to the industry average, PLURISTEM THERAPEUTICS INC has marginally lower results.
- PSTI'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 54.48%, 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 company, on the basis of net income growth 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 increased by 0.6% when compared to the same quarter one year prior, going from -$5.91 million to -$5.88 million.
- Current return on equity exceeded its ROE from the same quarter one year prior. This is a clear sign of strength within the company. Compared to other companies in the Biotechnology industry and the overall market, PLURISTEM THERAPEUTICS INC's return on equity significantly trails that of both the industry average and the S&P 500.
- Along with the stagnant revenue growth, the company underperformed against the industry average of 13.4%. Since the same quarter one year prior, revenues have remained constant. The stagnant revenue growth has not kept the company from increasing earnings per share.
- You can view the full analysis from the report here: PSTI