PTC Therapeutics (PTCT) Is Today's Perilous Reversal Stock - TheStreet

Trade-Ideas LLC identified

PTC Therapeutics

(

PTCT

) as a "perilous reversal" (up big yesterday but down big today) candidate. In addition to specific proprietary factors, Trade-Ideas identified PTC Therapeutics as such a stock due to the following factors:

  • PTCT has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $36.2 million.
  • PTCT has traded 140,745 shares today.
  • PTCT is down 3.4% today.
  • PTCT was up 6.2% yesterday.

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More details on PTCT:

PTC Therapeutics, Inc., a biopharmaceutical company, focuses on the discovery, development, and commercialization of orally administered, small molecule drugs that target post-transcriptional control processes. Currently there are 7 analysts that rate PTC Therapeutics a buy, no analysts rate it a sell, and 2 rate it a hold.

The average volume for PTC Therapeutics has been 1.0 million shares per day over the past 30 days. PTC has a market cap of $993.9 million and is part of the health care sector and drugs industry. The stock has a beta of -0.45 and a short float of 28.3% with 6.12 days to cover. Shares are down 40.5% year-to-date as of the close of trading on Monday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates PTC Therapeutics as a

sell

. The company's weaknesses can be seen in multiple areas, such as its feeble growth in its earnings per share, deteriorating net income, disappointing return on equity and generally disappointing historical performance in the stock itself.

Highlights from the ratings report include:

  • PTC THERAPEUTICS INC's earnings per share declined by 36.5% in the most recent quarter compared to the same quarter a year ago. Earnings per share have declined over the last year. We anticipate that this should continue in the coming year. During the past fiscal year, PTC THERAPEUTICS INC reported poor results of -$3.21 versus -$1.56 in the prior year. For the next year, the market is expecting a contraction of 50.8% in earnings (-$4.84 versus -$3.21).
  • 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 58.4% when compared to the same quarter one year ago, falling from -$27.28 million to -$43.22 million.
  • Return on equity has greatly decreased when compared to its ROE from the same quarter one year prior. This is a signal of major weakness within the corporation. Compared to other companies in the Biotechnology industry and the overall market, PTC THERAPEUTICS INC's return on equity significantly trails that of both the industry average and the S&P 500.
  • The share price of PTC THERAPEUTICS INC has not done very well: it is down 22.52% and has underperformed the S&P 500, in part reflecting the company's sharply declining earnings per share when compared to the year-earlier quarter. 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.
  • The current debt-to-equity ratio, 0.35, is low and is below the industry average, implying that there has been successful management of debt levels.

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