Editor's Note: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model
NEW YORK (
) has been downgraded by TheStreet Ratings from hold to 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 feeble growth in its earnings per share.
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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 1500.5% when compared to the same quarter one year ago, falling from $0.21 million to -$2.94 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, SIGA TECHNOLOGIES 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 -$12.25 million or 322.55% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
- SIGA TECHNOLOGIES INC's earnings have gone downhill when comparing its most recently reported quarter with the same quarter a year earlier. 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, SIGA TECHNOLOGIES INC turned its bottom line around by earning $0.24 versus -$0.62 in the prior year. For the next year, the market is expecting a contraction of 179.2% in earnings (-$0.19 versus $0.24).
- This stock's share value has moved by only 6.95% over the past year. Turning toward the future, the fact that the stock has come down in price over the past year should not necessarily be interpreted as a negative; it could be one of the factors that may help make the stock attractive down the road. Right now, however, we believe that it is too soon to buy.
SIGA Technologies, Inc., a pharmaceutical company, engages in the development and commercialization of pharmaceutical solutions for smallpox, Ebola, dengue, Lassa fever, and other dangerous viruses. Its lead product is ST-246, an orally administered antiviral drug that targets orthopoxviruses. The company has a P/E ratio of -8.8, below the S&P 500 P/E ratio of 17.7. Siga has a market cap of $150.3 million and is part of the health care sector and drugs industry. Shares are up 15.5% year to date as of the close of trading on Wednesday.
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-- Written by a member of TheStreet Ratings Staff
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