Trade-Ideas LLC identified

Ligand Pharmaceuticals

(

LGND

) as a weak on high relative volume 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 $47.7 million.
  • LGND has traded 168,999 shares today.
  • LGND is trading at 11.15 times the normal volume for the stock at this time of day.
  • LGND is trading at a new low 7.06% below yesterday's close.

'Weak on High Relative Volume' stocks are worth watching because major volume moves tend to indicate underlying activity such as material stock news, analyst downgrades, insider selling, selling from 'superinvestors,' or that hedge funds and traders are piling out of 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 (or avoid losses by trimming weak positions). 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 LGND:

Ligand Pharmaceuticals Incorporated, a biopharmaceutical company, focuses on developing and acquiring technologies that help pharmaceutical companies discover and develop medicines worldwide. LGND has a PE ratio of 11. Currently there are 4 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 371,100 shares per day over the past 30 days. Ligand has a market cap of $2.8 billion and is part of the health care sector and drugs industry. The stock has a beta of 0.82 and a short float of 22.4% with 10.86 days to cover. Shares are up 24.4% year-to-date as of the close of trading on Friday.

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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 very impressive revenue growth greatly exceeded the industry average of 13.8%. Since the same quarter one year prior, revenues leaped by 103.0%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • The current debt-to-equity ratio, 0.52, is low and is below the industry average, implying that there has been successful management of debt levels. Along with this, the company maintains a quick ratio of 10.64, 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 550.00% and other important driving factors, this stock has surged by 27.44% 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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