Strong On High Relative Volume: Lannett (LCI)
Trade-Ideas LLC identified
(
) as a strong on high relative volume candidate. In addition to specific proprietary factors, Trade-Ideas identified Lannett as such a stock due to the following factors:
- LCI has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $19.1 million.
- LCI has traded 144,552 shares today.
- LCI is trading at 3.71 times the normal volume for the stock at this time of day.
- LCI is trading at a new high 5.00% above yesterday's close.
'Strong on High Relative Volume' stocks are worth watching because major volume moves tend to indicate underlying activity such as M&A events, material stock news, analyst upgrades, insider buying, buying from 'superinvestors,' or that hedge funds and momentum traders are piling into 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. 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 LCI:
Lannett Company, Inc. develops, manufactures, packages, markets, and distributes generic versions of branded pharmaceutical products in the United States. LCI has a PE ratio of 26. Currently there are 4 analysts that rate Lannett a buy, 1 analyst rates it a sell, and 1 rates it a hold.
The average volume for Lannett has been 1.1 million shares per day over the past 30 days. Lannett has a market cap of $760.7 million and is part of the health care sector and drugs industry. The stock has a beta of 2.35 and a short float of 36.1% with 11.00 days to cover. Shares are down 49.2% year-to-date as of the close of trading on Thursday.
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Analysis:
rates Lannett as a
. The company's strengths can be seen in multiple areas, such as its robust revenue growth, reasonable valuation levels and expanding profit margins. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, generally higher debt management risk and a generally disappointing performance in the stock itself.
Highlights from the ratings report include:
- LCI's very impressive revenue growth greatly exceeded the industry average of 4.7%. Since the same quarter one year prior, revenues leaped by 64.8%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
- The gross profit margin for LANNETT CO INC is rather high; currently it is at 55.03%. Despite the high profit margin, it has decreased significantly from the same period last year. Despite the mixed results of the gross profit margin, LCI's net profit margin of -3.35% significantly underperformed when compared to the industry average.
- Despite any intermediate fluctuations, we have only bad news to report on this stock's performance over the last year: it has tumbled by 65.66%, worse than the S&P 500's performance. Consistent with the plunge in the stock price, the company's earnings per share are down 115.46% 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.
- 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 Pharmaceuticals industry. The net income has significantly decreased by 115.2% when compared to the same quarter one year ago, falling from $36.23 million to -$5.49 million.
- You can view the full Lannett Ratings Report.
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