Trade-Ideas LLC identified

Ligand Pharmaceuticals

(

LGND

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

  • LGND has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $39.6 million.
  • LGND has traded 107,241 shares today.
  • LGND is down 4% today.
  • LGND was up 5.4% yesterday.

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More details on LGND:

Ligand Pharmaceuticals Incorporated operates as a biotechnology company in the United States. LGND has a PE ratio of 8. Currently there are 2 analysts that rate Ligand Pharmaceuticals a buy, no analysts rate it a sell, and 1 rates it a hold.

The average volume for Ligand Pharmaceuticals has been 346,100 shares per day over the past 30 days. Ligand has a market cap of $2.0 billion and is part of the health care sector and drugs industry. The stock has a beta of 0.58 and a short float of 25.4% with 10.14 days to cover. Shares are up 99.7% year-to-date as of the close of trading on Wednesday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Ligand Pharmaceuticals as a

buy

. The company's strengths can be seen in multiple areas, such as its robust revenue growth, largely solid financial position with reasonable debt levels by most measures, notable return on equity, reasonable valuation levels and solid stock price performance. Although the company may harbor some minor weaknesses, we feel they are unlikely to have a significant impact on results.

Highlights from the ratings report include:

  • LGND's revenue growth has slightly outpaced the industry average of 13.4%. Since the same quarter one year prior, revenues rose by 18.2%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • The debt-to-equity ratio is somewhat low, currently at 0.69, and is less than that of the industry average, implying that there has been a relatively successful effort in the management of debt levels. Along with this, the company maintains a quick ratio of 12.24, which clearly demonstrates the ability to cover short-term cash needs.
  • The company's current return on equity greatly increased when compared to its ROE from the same quarter one year prior. This is a signal of significant strength within the corporation. Compared to other companies in the Biotechnology industry and the overall market, LIGAND PHARMACEUTICAL INC's return on equity significantly exceeds that of both the industry average and the S&P 500.
  • Powered by its strong earnings growth of 17333.33% and other important driving factors, this stock has surged by 63.48% over the past year, outperforming the rise in the S&P 500 Index during the same period. Turning to the future, naturally, any stock can fall in a major bear market. However, in almost any other environment, the stock should continue to move higher despite the fact that it has already enjoyed nice gains in the past year.

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